{"id":101893,"date":"2025-01-17T15:40:00","date_gmt":"2025-01-17T15:40:00","guid":{"rendered":"https:\/\/en.econostrum.info\/uk\/?p=101893"},"modified":"2025-01-17T14:39:26","modified_gmt":"2025-01-17T14:39:26","slug":"next-boss-rising-costs-policy-level-jobs","status":"publish","type":"post","link":"https:\/\/en.econostrum.info\/uk\/next-boss-rising-costs-policy-level-jobs\/","title":{"rendered":"Next Boss Warns: Rising Costs and Policy Changes Threaten Entry-Level Jobs"},"content":{"rendered":"\n<p>Rising <strong>National Insurance (NI)<\/strong> contributions and an increased <strong>minimum wage<\/strong> are placing unprecedented pressure on businesses. Lord Wolfson, chief executive of <strong>Next<\/strong> and a Conservative life peer, warns that entry-level job opportunities could dwindle in 2025 as employers struggle to absorb these additional costs. <\/p>\n\n\n\n<h2 class=\"gb-headline gb-headline-ce0acda6 gb-headline-text\">The Disproportionate Impact of Tax Reforms on Low-Wage Workers<\/h2>\n\n\n\n<p>The latest <a href=\"https:\/\/en.econostrum.info\/uk\/tax-hikes-squeeze-uk-businesses-layoffs\/\">tax<\/a> changes have lowered the employer contribution threshold from <strong>\u00a39,100 to \u00a35,000<\/strong>, significantly increasing the financial burden on businesses. For part-time, low-wage employees, tax increases equate to <strong>6.5%<\/strong>, compared to just <strong>2%<\/strong> for higher earners on \u00a360,000 salaries, leaving lower-paid workers disproportionately affected.<\/p>\n\n\n\n<p>\u201cThe axe has fallen particularly hard on those entry-level, <strong>National Living Wage<\/strong> jobs,\u201d said Wolfson. \u201cMy worry is that it\u2019s going to be harder and harder for people to enter the <strong>workforce<\/strong>.\u201d<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Retail Sector Faces A Double Squeeze<\/h2>\n\n\n\n<p>Businesses across the <strong><a href=\"https:\/\/retailsectorcouncil.co.uk\/\" target=\"_blank\" rel=\"noopener\">retail sector<\/a><\/strong> are already preparing to mitigate the challenges. Next plans to implement a <strong>1% price increase<\/strong> across its range in 2025. Yet, the <strong>high street<\/strong> remains on shaky ground:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Retail sales decline<\/strong>: December sales dropped <strong>0.3%<\/strong>, driven primarily by food sales, even as clothing sales rose by <strong>4.4%<\/strong>.<\/li>\n\n\n\n<li><strong>Warnings of job cuts<\/strong>: Last year, multiple <a href=\"https:\/\/en.econostrum.info\/uk\/retailers-price-hikes-national-insurance\/\">retailers<\/a>\u2014including Next\u2014signed a letter urging the government to revise Budget measures.<\/li>\n<\/ul>\n\n\n\n<p>Despite these pleas, <strong>Chancellor Rachel Reeves<\/strong> remains steadfast, describing the measures as \u201cthe right decisions in the national interest.\u201d<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Workers\u2019 Rights Bill: A Barrier to Seasonal Flexibility?<\/h2>\n\n\n\n<p>Lord Wolfson has also criticised the government\u2019s proposed <strong>workers\u2019 rights legislation<\/strong>, arguing it could harm operational <strong>flexibility<\/strong> for businesses. Currently, companies like Next rely on offering employees additional hours during busy periods, such as Christmas.<\/p>\n\n\n\n<p>Key concerns include:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Binding contracts<\/strong>: \u201cIf the legislation is going to mean that those hours have to be contractually binding forever, then we just won\u2019t be able to do it at all. It would be impossible,\u201d Wolfson stated.<\/li>\n\n\n\n<li><strong>Seasonal workforce impact<\/strong>: Employers could face reduced ability to adapt to fluctuating <strong>demand<\/strong>.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Government Spending Under Scrutiny<\/h2>\n\n\n\n<p>Beyond retail, Lord Wolfson called for greater efficiency in <strong>public sector spending<\/strong>, noting that the government has hired an additional <strong>100,000 civil servants<\/strong> in the past five years.<\/p>\n\n\n\n<p>\u201cWe can\u2019t go on spending over 40% of GDP on the public sector,\u201d he said. \u201cIf the government can commit to becoming more efficient \u2013 and deliver it \u2013 that will do more for <strong>business confidence<\/strong> than anything else.\u201d<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><thead><tr><th><strong>Earner Type<\/strong><\/th><th><strong>Income Level<\/strong><\/th><th><strong>Tax Increase (%)<\/strong><\/th><th><strong>Potential Outcome<\/strong><\/th><\/tr><\/thead><tbody><tr><td>Entry-Level Worker<\/td><td>\u00a310,000\u2013\u00a320,000<\/td><td>6.5%<\/td><td>Reduced job opportunities<\/td><\/tr><tr><td>Mid-Level Professional<\/td><td>\u00a340,000<\/td><td>4%<\/td><td>Minimal effect<\/td><\/tr><tr><td>Senior Management<\/td><td>\u00a360,000+<\/td><td>2%<\/td><td>Insulated from major financial impact<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\">Navigating the Future of Employment in the UK<\/h2>\n\n\n\n<p>Lord Wolfson\u2019s critiques offer a stark reminder of the unintended consequences of well-intentioned policies. The balance between fostering <strong>economic growth<\/strong>, protecting workers\u2019 rights, and ensuring job creation demands careful recalibration.<\/p>\n\n\n\n<p>The government must address these critical questions:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Can the <strong>tax system<\/strong> be restructured to alleviate pressure on entry-level jobs?<\/li>\n\n\n\n<li>Should <strong>public sector efficiency<\/strong> take precedence in reducing the national spending burden?<\/li>\n\n\n\n<li>How can businesses and policymakers collaborate to sustain both <strong>job creation<\/strong> and rights protection?<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Rising taxes and wage costs are reshaping the job market, with entry-level roles facing the greatest risk. Retailers like Next warn of shrinking opportunities and higher prices as businesses grapple with government policies. Could these changes spell trouble for the UK workforce?<\/p>\n","protected":false},"author":6,"featured_media":101908,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[27],"tags":[],"class_list":["post-101893","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-employment","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33","no-featured-image-padding"],"_links":{"self":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/101893","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/comments?post=101893"}],"version-history":[{"count":6,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/101893\/revisions"}],"predecessor-version":[{"id":101903,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/101893\/revisions\/101903"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/media\/101908"}],"wp:attachment":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/media?parent=101893"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/categories?post=101893"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/tags?post=101893"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}