UK Businesses Brace for Economic Strain as April Tax Hikes Loom

Upcoming increases in National Insurance contributions and the minimum wage are expected to hit private sector jobs, wages, and prices while intensifying inflation concerns.

The UK hospitality and retail sectors are preparing for significant cost increases from April, driven by a rise in employer National Insurance contributions and a 6.7% increase in the minimum wage.
Private sector employment has already fallen sharply, with a combined loss of over 94,000 jobs in hospitality, retail, and related industries over the past year, according to ONS data.
The Bank of England forecasts inflation to rise to 3.7% later this year, partly due to higher labor costs, complicating efforts to reduce interest rates further.
Businesses across sectors are cutting jobs, scaling back investments, and raising prices to cope with the anticipated financial burden, with some warning of closures and relocations abroad.
Public services, charities, and local councils are also facing increased costs, leading to higher taxes, service cuts, and financial strain across the UK.