Business Bosses Fuming as Labour's Tax Bomb Crushes Hiring Plans

By HOAR Team 12 May, 2025 4 mins read 120 Views

God. I've been talking to company directors all week and I've never seen them this angry. The mood in boardrooms across Britain is absolutely poisonous right now.

A devastating new report landed on my desk this morning showing employer confidence has crashed to historic lows. And honestly? I'm not surprised. Not even slightly.

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The Brutal Numbers Nobody Wants to Talk About

Here's teh reality check: a quarter of businesses are now planning to lay people off within the next three months. Let that sink in. Not trimming a bit around the edges – we're talking proper redundancies. Meanwhile, hiring intentions have collapsed to levels we haven't seen since everyone was locked in their homes during COVID.

The Chartered Institute of Personnel and Development surveyed 2,000 business leaders, and the results are grim. The number of companies expecting to increase their workforce has fallen off a cliff.

Why? Two words: Labour government.

Rayner's Red Tape Nightmare

I had lunch with a manufacturing CEO last Tuesday who literally showed me the paperwork his HR team is preparing for Angela Rayner's Employment Rights Bill. "This will cost us about £80K in compliance alone," he told me while stabbing angrily at his salad. "That's three entry-level jobs we won't be creating next year."

Bosses across the country are looking at this bill with absolute horror. It hands workers a bunch of new rights from Day One – sounds lovely in theory, feels like concrete boots to companies already struggling to keep their heads above water.

Wait... it gets worse

Remember that £25billion National Insurance hike announced in the Budget? Well, it started hammering businesses last month. The timing couldn't be more catastrophic.

One small business owner I spoke to yesterday (runs a chain of three cafes in Manchester) just shook her head when I asked about it. Her response: "Already updating my resume." Dark humor, but she wasn't actually joking.

James Cockett, senior labour market economist at the CIPD, put it diplomatically: "Employer confidence is low, which is being reflected in their hiring plans."

Low? It's like watching someone flatten a soufflé with a sledgehammer.

The Numbers Don't Lie (Even When Politicians Do)

The CIPD's tracker of employer sentiment plummeted from +13 to +8 last quarter. Back in 2018, I remember reporting on similar figures during the Brexit chaos, but this feels different. More... permanent somehow.

Shadow Business Secretary Andrew Griffith didn't mince words: "This report only confirms what we hear daily from the shop floor to the boardroom: confidence has collapsed. Labour can't understand why because their Cabinet has zero business experience."

Ouch. But he's not wrong.

So what happens next?

I've covered business news for 12 years now, adn I've rarely seen this level of pessimism spreading so quickly. It's like watching dominoes fall in slow motion.

The government seems totally blindsided by the reaction. They genuinely thought businesses would just absorb these costs without changing behavior. (I feel stupid now for not predicting this trainwreck months ago when the Budget was first announced.)

No one's saying workers shouldn't have rights.

But when you combine massive tax increases with complex new regulations during a period of global uncertainty... what exactly did they think would happen?

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