Shops and pubs will cut MORE jos as Budget hikes their costs, grim report warns
SHOPS, pubs and high street businesses will keep cutting jobs as the Budget adds to rising costs, a report warns today.
Business activity has dropped 27 per cent in just three months, according to the Confederation of British Industry.
Retail, services and distribution have been the worst hit.
The report says consumer services — including pubs, shops and restaurants — are facing their bleakest outlook since 2022, while distribution sales are expected to tumble further.
It claims firms have been cutting jobs since November, with hiring to shrink further.
And the rise in National Insurance Contributions announced in Chancellor Rachel Reeves’ October Budget is adding further pressure, as firms are reducing headcount or holding back pay rises.
But the report warns the wider economic slowdown is also playing a major role.
CBI economist Alpesh Paleja said companies are facing “a tough operating environment”, despite some small improvements in manufacturing.
He added: “Rising real incomes will hopefully give households more confidence to spend, giving some relief to the sectors suffering the most.
“But, as our latest surveys highlight, more action is needed to rev up growth.”
The CBI warns job vacancies are back to pre-pandemic levels, and payroll numbers have remained flat since mid-2024.
Shadow Chancellor Mel Stride said it is more evidence the Labour Government does “not understand businesses or the economy”.
He added: “Labour promised growth — we haven’t got it.
“They promised businesses stability and confidence — we haven’t got it.”
The Treasury said business leaders are “confident that the Chancellor’s growth plans will help drive investment”.