Job losses loom in further sign of economic slowdown

The UK jobs market is set to take a knock this year after it weathered the gloomiest post-furlough predictions, reveals new research published today.

Around one in five firms are intending to scale back staffing levels over the coming year, according to conciliation service Acas.

The fresh survey illustrates the steep deterioration in the trading environment since the turn of the year that is leading to firms considering cutting costs.

Businesses are being saddled with higher energy bills as a result of the Kremlin’s brutal invasion of Ukraine sending oil and gas prices soaring.

Elevated energy spending is being compounded by a 1.25 percentage point national insurance hike and higher interest rates, adding to businesses’ cost burdens.

Data released last week by law firm GQ Littler revealed planned redundancies had taken off ahead of the national insurance hike taking effect on 6 April.

Households are also expected to slash spending this year in response to wages failing to keep pace with an average inflation rate across the year of above seven per cent eroding their living standards at the quickest pace since the mid-1950s.

Acas chief executive Susan Clews said: “The impact of global events has seen some businesses facing difficult circumstances.”

The jobs market had held up well after the furlough scheme ended, mainly due to the UK economy roaring back from the damage inflicted on it by the Covid-19 crisis.

However, higher than expected inflation has hit the recovery.