Staff layoffs in UK gain pace amid Trump tariff turmoil and labour cost increases

Phillip Inman

Sun, May 11, 2025, 4:00 PM 4 min read

UK employers laid disconnected unit successful April astatine a faster gait than the erstwhile period arsenic the operation of higher employment costs and daze waves from Donald Trump’s tariff war sent boardroom assurance levels plummeting.

The quality resources association, CIPD, said employer assurance levels slumped to an all-time low, prompting occupation cuts and a wide hiring freeze.

Higher nationalist security contributions (NICs) and the rise successful the nationalist surviving wage, which some came into effect successful April, and the uncertainty created by the US president’s import duties were blamed by employers for ending signs of optimism earlier successful the year.

The driblet successful assurance levels was matched by the autumn to a grounds low, extracurricular the pandemic, successful the fig of UK employers expecting to summation headcount successful the adjacent 3 months. CIPD records spell backmost to 2014.

A abstracted survey of tiny and medium-sized businesses by the concern advisory firm, BDO, revealed a akin picture.

The steadfast said a diminution successful output successful April by manufacturing and services firms underscored the unit facing businesses, “with assurance levels present astatine their weakest constituent successful 4 years, comparable to levels seen during the nationalist lockdowns”.

The chancellor, Rachel Reeves, volition anticipation the surveys – which were completed earlier past week’s cut successful involvement rates by the Bank of England and the UK trade agreements with the US and India – volition amusement a rebound successful assurance during the summer.

Reeves has said that increasing the system is her No 1 precedence and that she needs firms to beryllium much optimistic if they are to summation concern and grow production.

However, the CIPD said a betterment could not beryllium guaranteed erstwhile employers were apt to beryllium faced with other costs from the government’s employment rights bill, which added different furniture of uncertainty to an already hard outlook.

James Cockett, elder labour marketplace economist astatine the CIPD, said: “The employment rights measure is landing successful a fundamentally antithetic scenery to the 1 expected erstwhile it formed portion of the Labour manifesto successful summertime of past year.

“It was ever going to beryllium a immense alteration for employers, but they’re operating successful an adjacent much analyzable satellite now. It’s captious the authorities works intimately with employers to equilibrium the precise existent hazard of reductions successful concern successful people, grooming and exertion with their tendency to trim mediocre employment practice.”

The CIPD’s latest labour marketplace outlook report, based connected a survey of 2,000 employers, showed the complaint of firms expecting to summation headcount had fallen sharply among ample backstage assemblage employers, and successful retail successful particular.