Rachel Reeves Faces Blowback as London Hiring Slumps After Tax Hike
Rachel Reeves is under fire following a dramatic drop in hiring figures across London, with businesses reeling from her recent employer tax hike.
The capital has seen its most sluggish performance in permanent hiring since the beginning of the year, according to a new report. The figures, part of a regular analysis of the jobs market, show a stark contrast to the rest of the UK, with London lagging behind in workforce growth.
According to industry analysts, employers are now grappling with the consequences of higher national insurance contributions introduced in April. The move has triggered concern across boardrooms, especially in the face of a shaky global economy.
“Job placements fell sharply,” stated the latest data published by KPMG and the Recruitment and Employment Confederation (REC), with backing from BusinessLDN.
“Concerned by the volatility of the immediate outlook, especially as employment costs rise,” many businesses appear to be putting the brakes on recruitment efforts.
The figures paint a grim picture for both temporary and permanent job vacancies in May. Analysts note that while the rest of the country is experiencing a mixed job market, London’s slump appears to be more pronounced.
It’s a troubling sign for the Chancellor, who has defended the tax adjustment as necessary for long-term fiscal stability. However, the short-term effects seem to be biting.
Recruiters and business leaders are calling for urgent reassurances from the government. They argue that additional pressures—from global uncertainty to local cost increases, are creating the perfect storm for London’s hiring market.
One source within the employment sector said off-record: “Businesses are hesitant. They need clarity, not more costs.”
With London being a bellwether for broader economic trends, this downturn could spell wider implications if not addressed promptly.
As the dust settles, all eyes will be on the Chancellor’s next move—and whether her strategy will steady the ship or stir further unrest among employers.
