It will be harder for people to get first jobs | Global News Avenue

The boss of retail giant Next said tax changes announced in the Budget would make it “harder for people to enter the labor market”.

Lord Wolfson told the BBC that an increase in national insurance paid by businesses would particularly hit the retail sector, meaning cuts to entry-level jobs would be “particularly severe”.

He called on the government to stagger the timing of the tax reform rather than implementing it in April, otherwise jobs or working hours would have to be cut.

But a Treasury spokesman said the budget measures were aimed at “cleaning it up” and bringing stability to businesses.

In last October’s Budget, the government increased employer-paid National Insurance (NI) rates from April and lowered the threshold at which employers start paying from £9,100 to £5,000.

Businesses also faced a rise in the national living wage in April, which was twice the rate of inflation.

Conservative peer Lord Wolfson said the changes would hit hardest employers with large numbers of low-paid or part-time workers.

Next’s wage bill will rise by £70m, which Lord Wolfson said will result in a reduction in staff hours – either fewer workers or fewer hours per employee.

He called on the government to lower the NI threshold over time, rather than the months’ notice employers were given in the October budget.

He said that while the tax increase for a £60,000-a-year job would be about 2%, that for a part-time living wage worker would be about 6.5%.

“So the cuts are going to be particularly severe in those entry-level national living wage jobs, which is where the pain will be felt most.”

Lord Wolfson said this was a concern not just for retailers but for the economy as a whole. Next received 13 applications for each Christmas vacancy this year, a 50% increase on last year.

“I’m worried it’s going to be harder and harder for people to enter the workforce,” he said.

“It’s hard to see how a significant increase in the cost of entry-level jobs would have anything other than a reduction in available opportunities.”

But a Treasury spokesman said more than half of employers would see their National Insurance bills cut or “unchanged”.

They added that they were “creating the conditions” for economic growth through measures such as capping corporate tax rates and establishing a national wealth fund.

The NI and minimum wage measures have sparked criticism from UK companies, who believe the changes run counter to the government’s aim of boosting economic growth.

earlier this month, British Chambers of Commerce says confidence ‘slumping’Faced with the “pressure cooker of rising costs and taxes,” more than half of businesses plan to raise prices in the next three months.

Last year, Next was one of the signatories of the agreement A letter from UK retailers to Chancellor Rachel Reeves Calls for a reconsideration of budget measures.

The letter said job losses on the streets were “inevitable” and warned that prices would rise and shops would close.

Next made profits of more than £1 billion last year, while other large retailers with large workforces – such as Tesco and Sainsbury’s – also made huge profits. Lord Wolfson acknowledged the chancellor’s insistence that they have “broad shoulders” that must bear the brunt of the tax increases needed to rebuild public services.

“The government does need to raise taxes. In principle I’m not opposed to lowering the threshold for state taxation, but the problem is the speed at which it happens and the lack of consultation.”

Lord Wolfson also raised concerns about the new workers’ rights bill.

This is expected to provide employees with greater protection against unfair dismissal and “exploitative” zero-hours contracts, with employees able to apply for guaranteed hours contracts based on hours worked over a period of time. But this could cause problems for retailers.

“We offer our staff extra hours in the run-up to Christmas. If the legislation means those hours have to be contractually binding forever then we simply can’t do that, it’s just not possible.”

He offered some advice for the chancellor to boost growth and business confidence. Start in your own backyard.

“In the past five years, the government has added 100,000 civil servants.

“We cannot continue to spend more than 40 per cent of GDP on the public sector. The public sector has to become more efficient and if the government can commit to doing that and delivering on that then I think that will enhance it more than anything Business Confidence Others.”