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\t\tUK businesses slash jobs over tax increase pressure \t<\/p>\n
UK employers slashed jobs<\/a> at the fastest pace in four years as companies suffer the costs of tax decisions from Rachel Reeve\u2019s Autumn Budget last year.<\/p>\n Companies cut employment by an annual rate of 0.5 per cent in the three months to August. This is the worst figure since 2021, according to a Bank of England survey<\/a> of chief financial officers.<\/p>\n Expectations for employment growth over the next year have also weakened, falling by 0.3 percentage points to 0.2 per cent in the three months to August.<\/p>\n This is the lowest reading since October 2020, when the UK economy was starting to claw back from the blow of the Covid-19 pandemic.<\/p>\n Despite employment cuts, annual wage growth remained subdued, at 4.6 per cent in the three months to August, 0.1 percentage points lower than the three months to July.<\/p>\n Wage growth for the year ahead remained unchanged at 3.6 per cent.<\/p>\n Fingers pointed at the Budget<\/p>\n Companies have blamed their employment woes on the tax increases introduced in Reeves\u2019 first Budget last October.<\/p>\n \t\t\t\t\tRead more<\/p>\n \t\t\tLosses double at global recruiter despite sales passing \u00a32bn<\/a><\/p>\n Nearly half of the surveyed companies said they were cutting jobs as a result of the Chancellor\u2019s decision to increase employer national insurance (NI) contributions.<\/p>\n A \u00a325bn increase in NI contributions took effect in April, along with a rise in minimum wage.<\/p>\n But since the tax increase came into force, 20 per cent of companies reported lowering wages, while a third opted to increase prices.<\/p>\n Over two thirds reported lowering profit margins.<\/p>\n Executives also increased their expectations for inflation<\/a> over the coming year by 0.1 percentage points to 3.3 per cent.<\/p>\n Reeves under pressure to fill black hole <\/p>\n The damning report will place further pressure on Reeves, as ministers scramble to confront an estimated \u00a320bn hole in public finances.<\/p>\n The Treasury is mulling a host of tax increases in the run up to the impeding Autumn Budget on the 26th November<\/a>, but executives and industry bodies have warned against fresh rises.<\/p>\n \t\t\t\t\tRead more<\/p>\n