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UK Firms Cut Staff at Fastest Pace Since Pandemic Before Reeves’s Budget

Investors now expect the Bank of England to cut rates on 18 December.

Overview

  • A Bank of England survey showed private‑sector employment fell 1.8% in November, the steepest monthly drop since July 2021.
  • Finance directors indicated plans to reduce staffing by an average of 0.7% over the next 12 months, the largest projected fall since October 2020.
  • HMRC figures recorded a 180,000 decline in payrolled employment in the year to October, a rare year‑on‑year fall outside the pandemic period.
  • The chancellor’s latest budget raised about £26 billion, largely through consumer‑focused measures including an extended freeze on income‑tax thresholds that will eventually push roughly one in four workers into the 40% band.
  • The Bank reported wages up 4.6% year on year to November with pay growth intentions easing to 3.6%, while its survey showed three‑year inflation expectations rising to 3%.