‘A Budget of missed opportunities’ as employers warn high hiring costs are choking job creation

The Government has pinned its hopes for job creation on investment and the promise of future growth, but employers are left asking a more immediate question: where is the relief from rising hiring costs?

For businesses and the jobs market, the Budget amounted to a “nothing” event, according to a sharp assessment of the measures announced. Employers may be relieved that no further employment costs were piled on, but the absence of additional pressure is hardly the same as meaningful support.

“Nothing added to the already higher employment costs — we can be thankful for that — but nothing done to ease them,” the assessment warned.

The criticism cuts to a central tension in the Government’s economic strategy. Ministers have acknowledged the challenge of youth unemployment, yet employers see little in the Budget that would directly encourage them to create the jobs needed to bring young people into the labour market.

The Government’s broader bet appears to rest on the creation of a new National Wealth Fund and wider investment measures. The hope is that greater investment will stimulate economic activity, strengthen businesses and ultimately generate employment.

But that strategy risks overlooking a more immediate obstacle facing employers: the cost of taking on staff.

“Greater investment is welcome, but it’s not just a lack of investment holding back job creation, it is the high cost of employment,” the assessment argued.

For companies weighing whether to expand their workforce, the distinction matters. Investment may create opportunities over time, but it does not automatically make an additional employee affordable today. Nor does it guarantee that new jobs will be accessible to younger workers struggling to secure their first foothold in the labour market.

That leaves the Government facing a difficult test. Ministers must demonstrate that their investment ambitions can translate into actual vacancies, rather than remain a promise of jobs further down the line.

“Employers will want to know how today’s headlines will create the conditions to increase hiring,” the assessment concluded, particularly for younger workers.

The Budget may have avoided making employers’ position worse. Whether it has done enough to make hiring worthwhile remains the unanswered question.