More than a quarter of a million jobs have been lost in Britain since Rachel Reeves\u2019s autumn budget, official figures show, fuelling a rise in unemployment to the highest level in almost four years.<\/p>\n
In a blow for the chancellor on the eve of Wednesday\u2019s highly awaited spending review<\/a>, the figures from HMRC show the number of workers on company payrolls fell by 109,000 in May \u2013 the largest monthly fall since the same period in 2020 during the first Covid lockdown.<\/p>\n Business leaders blamed the hit to jobs on Reeves\u2019s tax-raising October budget, including a \u00a325bn rise in employer national insurance contributions (NICs)<\/a> affecting more than 1m companies, which came into effect in April.<\/p>\n Combined with challenges for employers, including high borrowing costs and heightened uncertainty amid Donald Trump\u2019s trade wars, the figures took the total number of jobs lost since the October budget to 276,000.<\/p>\n \u201cThese shocking figures should make it abundantly clear to the government that the changes to employer NICs are inflicting more harm than good, and they should be reviewed and reversed urgently,\u201d said Kate Nicholls, the chief executive of the lobby group UKHospitality.<\/p>\n \u201cWe were clear at the time that the changes to NICs were a tax on jobs, and so it is sadly proving.\u201d<\/p>\n Separate figures from the Office for National Statistics<\/a> showed Britain\u2019s official unemployment rate rose to 4.6% in the three months to April, up from 4.5% in the previous three-month period, to reach the highest level since July 2021.<\/p>\n Annual growth in regular wages slowed to 5.2% from a revised 5.5%, below City economists\u2019 forecasts for a reading of 5.3%.<\/p>\n UK unemployment chart<\/a><\/p>\n The ONS\u2019s figures are based on its widely criticised<\/a> labour force survey, which has suffered from collapsing response rates. Experts have argued this leaves policymakers \u201cflying blind\u201d, creating the prospect that decisions are being taken based on flawed data.<\/p>\n However, economists said there was clear evidence of a slowdown in the labour market, including a 63,000 fall in the number of job vacancies posted by employers in the three months to the end of May.<\/p>\n Suren Thiru, the economics director at the Institute of Chartered Accountants in England and Wales, said: \u201cThese figures suggest that the UK\u2019s jobs market took a damaging hit from \u2018Awful April\u2019, with the tough reality of sharply rising NICs and national living wage costs pushing more employers to cut staff.<\/p>\n \u201cThe UK\u2019s labour market is in a painful period with eye-wateringly high business costs likely to mean more job losses this year, particularly if the spending review increases the odds of more tax hikes in the autumn budget.\u201d<\/p>\n Businesses in typically lower-paying sectors, including hospitality, leisure and retail, had warned jobs could be hit. Andrew Griffith, the shadow business secretary, said the increase in unemployment was \u201cdisappointing but no surprise\u201d.<\/p>\n skip past newsletter promotion<\/a><\/p>\n Sign up to Business Today<\/p>\n Get set for the working day \u2013 we’ll point you to all the business news and analysis you need every morning<\/p>\n Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Privacy Policy<\/a>. We use Google reCaptcha to protect our website and the Google Privacy Policy<\/a> and Terms of Service<\/a> apply.<\/p>\n after newsletter promotion<\/p>\n It comes as the Bank of England<\/a> monitors the jobs market for signs of weaker conditions as policymakers consider whether to cut interest rates further after four earlier reductions in borrowing costs to 4.25%<\/a>.<\/p>\n