Labour's jobs slump: Nearly 1,400 roles shed for each day since the Budget
Nearly 1,400 jobs a day were lost in the UK last month, new figures show, making a mockery of Rachel Reeves’s claim that she is boosting the economy.Payroll numbers shrank by 43,000 in December, the largest slump since November 2020 during Covid, according to Office for National Statistics (ONS) statistics.It came as the Chancellor arrived at the World Economic Forum in Davos to claim that Labour had brought stability and would start to ‘reap dividends’ this year.But business leaders at the summit lined up to warn that many of the party’s policies had been counterproductive – and were driving away investment and talent.Higher taxes, minimum wage hikes and new workers’ rights rules have been blamed for the jobs rout, which has seen 216,820 jobs lost since Labour came to power.Tory business spokesman Andrew Griffith said it was a ‘terrible scorecard’ for the Government, adding: ‘Jobs are becoming a crisis on their watch.’ Debatable: Chancellor Rachel Reeves (pictured) arrived at the World Economic Forum in Davos to claim that Labour had brought stability and would start to ‘reap dividends’ this yearYet Ms Reeves told a Bloomberg event in Davos: ‘Our plan is the right one.‘It will begin to reap dividends this year especially as inflation gets back to target and the benefits of trade deals begin to flow.’She said not every decision that the Government has made ‘has been one that’s welcomed by business’.But she added: ‘I hope businesses see in Britain a country that has returned to stability, that is bringing investment, is changing the way the economy works and is open to business, open to trade, open to investment and open to talent as well.’But elsewhere in Davos, Rishi Khosla, chief executive of OakNorth bank – whose clients include many entrepreneurs – said some had now lost faith in the Government.Mr Khosla told the Mail: ‘There’s lower confidence that what is being said is going to be delivered.’That has contributed to the exodus of wealth creators from BritainMr Khosla said these people felt ‘that the UK doesn’t have a stable environment, it’s not a growth market, taxes are only going one way’.Louis Mosley, UK and Europe boss for US tech giant Palantir, warned that high taxes in the UK could drive away the talent that will be needed to fuel the ‘AI revolution’.Palantir has 1,000 employees in Britain, its largest concentration outside the US, and major data contracts with the NHS and Ministry of Defence.Mr Mosley, who is also in Davos, told the Mail: ‘We have seen taxes go up, we’ve seen taxes on labour increase. Everything comes back to incentives in the end.‘I do think we’re increasingly at risk of creating an environment in which that becomes a disincentive.‘I think Britain still does, outside of America at least, remain this magnet for talent but we can’t take it for granted.’ Crisis: Higher taxes, minimum wage hikes and new workers’ rights rules have been blamed for the jobs rout, which has seen 216,820 jobs lost since Labour came to powerAnd Christophe Catoir, president of global recruitment firm Adecco, told the Mail that Britain’s workers’ rights act threatened to damage investment in the UK – hurting jobs.Mr Catoir told the Mail that while some elements of the rules ‘make sense’, the new laws risked going to ‘the other extreme’ and turning flexibility into ‘rigidity’.‘Sometimes we see it in some countries – the labour laws are so complex the investors are not investing any more because they are afraid… because they don’t know how it works,’ he said.And a top UK boss also attending the conference told the Mail that the workers’ rights bill and national insurance hikes introduced by Labour had been ‘counterproductive’.Darren Jones, chief secretary to the Prime Minister and a former Treasury minister, faced a backlash after he insisted the job losses were not the result of tax hikes and increases in regulation.‘I wouldn’t agree that government policy is destroying jobs,’ he told BBC Radio 4’s Today programme.But experts put the blame firmly at Labour’s door.Calum Blois, a manager at tax advisory firm Blick Rothenberg, said: ‘Recent increases to business rates, National Insurance contributions and energy costs are being reflected in the labour market. Workers are undoubtedly paying the price.’‘Many UK companies are reviewing hiring decisions, pausing recruitment, and some sectors, particularly retail and hospitality, are seeing accelerated job losses.‘Fewer people in employment results in lower tax receipts and reduced public spending, which in turn fuels further unemployment, a vicious doom loop that threatens further job losses.’ SAVE MONEY, MAKE MONEY4.33% cash Isa4.33% cash IsaTrading 212: 0.73% fixed 12-month bonus£100 cashback£100 cashbackTransfer or fund at least £10,000 with Prosper4.49% cash Isa4.49% cash IsaIncludes 12-month boost for new customers£2,000 cashback£2,000 cashback1% cashback up to £2,000 when transferringSipp transfersSipp transfersGet between £100 and £3,000 cashbackAffiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence. 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