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\t\tJonathan Reynolds’ industrial strategy is not paying off as jobs were lost. PA\t<\/p>\n\t\t\tMonday 27 July 2026 11:34 am
\n\t\t\t\t\t\u00a0|\u00a0\u00a0Updated:\u00a0<\/p>\n
\t\t\tMonday 27 July 2026 12:09 pm\n\t<\/p>\n
\t\tJonathan Reynolds’ industrial strategy is not paying off as jobs were lost. PA\t<\/p>\n
In a blow to the government\u2019s plans to boost employment, eight sectors previously identified as having high growth potential in Labour\u2019s industrial strategy have suffered job losses, according to a report seen by City AM.<\/p>\n
The so-called \u2018IS-8\u2019 sectors, which include life sciences, financial services and defence, were singled out by the UK government last year as having the \u201cgreatest potential for growth\u201d. The previous government\u2019s industrial<\/a> strategy, which has been adopted by Andy Burnham\u2019s government, aimed to create 1.1m new jobs by 2035, led by IS-8 sectors.<\/p>\n However, an annual report by the former Department of Business and Trade, which has since been renamed, found that job numbers fell across 2025 compared to the year before.\u00a0<\/p>\n The department\u2019s annual report on the industrial strategy\u2019s performance found that employment fell by 0.6 per cent in 2025 compared to 2024.\u00a0<\/p>\n Shadow business secretary Andrew Griffith said the figures were \u201cdamning\u201d given the eight sectors were being depended upon to drive job creation.\u00a0<\/p>\n \u201cLabour has been devastating to industry \u2013 their jobs tax has made hiring more expensive, their Employment Rights Act <\/a>has made hiring a legal minefield, and Ed Miliband\u2019s ideological war on affordable energy has left British industry paying some of the highest electricity prices in the developed world,\u201d the Conservative frontbencher said.\u00a0<\/p>\n \u201cLabour should stop the deindustrialisation of Britain by adopting our cheap power plan, cutting the taxes that punish employers, and by stopping treating British business as a cash machine.\u201d<\/p>\n Labour\u2019s struggles with jobs market<\/p>\n It was also found that some sectors, including defence and life sciences, only have \u201cpartial coverage\u201d in official statistics as some areas in data collection may overlap. It suggests that the government is unable to obtain a fully accurate picture of employment and business performance across the sectors.\u00a0<\/p>\n \t\t\t\t\tRead more<\/p>\n \t\t\tInvestor visa proposed by Labour-aligned think tank<\/a><\/p>\n The pattern of job losses in the UK\u2019s high-growth industries is consistent with a broader trend of rising\u00a0unemployment\u00a0across the country, with an increase in the unemployment rate from mid-2024 to 4.9 per cent representing an increase of around 200,000 out of work.\u00a0<\/p>\n Employers widely blamed former Chancellor Rachel Reeves\u2019 \u00a325bn tax increase via employers\u2019 national insurance contributions for troubles across the UK jobs market.\u00a0<\/p>\n Analysis of performance metrics on the industrial strategy also found that productivity had jumped across the eight sectors by three per cent while both goods and services exports were higher.\u00a0<\/p>\n The government also identified just 26 large, domestic businesses that were a part of the IS-8.\u00a0<\/p>\n The first round of 10 annual reports on the eight growth sectors, however, point to the difficulties faced by business secretary Jonathan Reynolds in boosting the private sector and delivering the industrial strategy.\u00a0<\/p>\n Some sectors within the IS-8, such as professional services and creative industries, have also been flagged by leading economists as being at risk of an AI jobs cull. The OECD<\/a> recently suggested that London was set to suffer more from AI\u2019s impact on the jobs market in part due to its strengths in professional and financial services jobs.\u00a0<\/p>\n A government spokesperson said: \u201cOur industrial strategy is designed to give certainty and stability to companies, and our latest report confirms it\u2019s working.<\/p>\n \u201cThe UK has attracted around \u00a3380bn of private investment since its launch last year, and Skills England estimates there could be over a million more priority jobs by 2035 in certain sectors.\u201d\u00a0\u00a0<\/p>\n \t\t\t\t\tRead more<\/p>\n