Rachel Reeves is ‘destroying jobs’ with 234,000 misplaced | Politics | News | EUROtoday

Embattled Chancellor Rachel Reeves has been accused of destroying jobs after unemployment rose by greater than 230,000 since Labour got here to energy. It locations her in a nightmare place as a result of it appears nearly sure she shall be pressured to lift taxes in her November 26 Budget to plug an enormous shortfall within the public funds – however it will damage the financial system much more.

Campaigners warned that younger persons are notably onerous hit, with many shifting on to advantages simply when they need to be beginning a profession. And employers warned there may be worse to return as Labour’s new staff’ rights laws threatens large job cuts within the retail sector. Today’s figures present 1.674 million folks aged 16 and over are unemployed. This is up from 1.44 million in comparison with figures for the interval masking final July’s normal election, an increase of 234,000.

At the identical time, the variety of payrolled workers was 30.3 million, which is a fall of 0.4% from August 2024 – the equal to 127,000 fewer workers.

Employers are clear that jobs have been misplaced due to Ms Reeves’s selections in final 12 months’s Budget to extend National Insurance and the minimal wage.

Jane Gratton, Deputy Director of Public Policy on the British Chambers of Commerce stated: “The ongoing impact of business cost pressures, most notably from the national insurance hike, continues to hit the labour market.

“Unemployment remains high and vacancies continue to fall with firms having to make difficult decisions on recruitment.”

Helen Whately, Shadow Work and Pensions Secretary, stated: “Today’s figures confirm what the country already knows – under this Labour Government, opportunity is shrinking, and the economy is paying the price.

“The Conservatives left office with unemployment near record low and the fastest-growing economy in the G7. In just over a year, Labour has overseen decline in our economy, deterioration in our public services, and a collapse in trust.”

But she warned additional tax rises within the November 26 Budget would make the financial scenario even worse.

“With families already struggling, the country is braced for Rachel Reeves’ impending tax rises, making it even harder for people to get by and for businesses to employ.”

Analysis by suppose tank the Centre for Social Justice discovered folks below the age of 25 had been notably affected, with 51,000 fewer under-25s in payrolled work in August 2025 in comparison with April 2025.

Ben Gregg, Senior Researcher on the Centre for Social Justice stated: “Young people are facing a toxic cocktail of rising employment costs and an influx of lower skilled migration into entry-level jobs. Many are turning to a life on mental health benefits as a result.

“The Government’s vow to get young people off benefits and into work is welcome, but these figures show how urgently they need to turn words into action.”

Employers stated that the Government’s Employment Rights Bill, anticipated to cross into legislation quickly, will make the scenario much more dire.

Helen Dickinson, Chief Executive on the British Retail Consortium, stated: “Today’s figures are a stark warning: retail jobs have plunged to a record low with 97,000 jobs lost over the last year, and almost 400,000 lost over the last decade.

“The rising cost of National Insurance contributions and the National Living Wage, together costing the industry over £5 billion this year, are hitting retail employment hard. And worse could be yet to come, with the Employment Rights Bill having a ‘materially negative impact on employment’ according to the OBR, and the threat of further cost rises at the Autumn Budget looming large.

“As costs mount on the industry, retail jobs are falling by the wayside. Whether it is the additional complexity wrought by the Employment Rights Bill, or a new surtax on large retail premises, the impact of these policies will be to drive up prices and hold back retail employment. It vital that the Chancellor’s Autumn Budget does not increase costs to the high street further, or else it will be working people who will pay the price as local, flexible jobs are lost, and the cost of living continues to rise.”

The Employment Rights Bill had been championed by former Deputy Prime Minister Angela Rayner, who referred to as it “the biggest upgrade to workers’ rights in a generation”. But an affect evaluation produced by the Government warned it will impose direct prices on enterprise of as much as £5billion. Firms would possibly merely take up this within the type of decrease income, but it surely might additionally result in greater costs, decrease wages or fewer jobs, the evaluation warned.

The new legislation will make it simpler for unions to carry strike motion and provides staff extra rights from day one within the job.

Work and Pensions Secretary Pat McFadden stated there have been shiny spots within the newest jobs market knowledge. He stated: “Today’s figures show signs of progress with economic inactivity and redundancies continuing to fall.

“But we must futureproof our workforce by giving people the opportunities and skills they need to secure the jobs of tomorrow.

“It is vital that our £240 million Get Britain Working plan is felt by people across the country, whether it’s through targeted support for young people entering the workforce, or joining up work, health and skills support.

“The true strength of the UK’s economy lies in the British people, which is why we are unlocking opportunity in every part of the country to drive forward economic growth under our plan for change.”