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British employers reduced their workforces after the Labor government’s tax-rise budget, even as wage growth accelerated, official data showed on Tuesday.
Payroll employment fell 0.1 percent between October and November and was 11,000 lower in the three months to November than in the previous quarter, according to figures from the Office for National Statistics.
Early estimates for December suggest a larger monthly decline of 47,000 to 30.3 million workers.
At the same time, average weekly earnings in the three months to November were 5.6 per cent higher than a year earlier, including and excluding bonuses, the ONS said. Economists expected 5.2 percent.
The figures come as evidence mounts that economic growth has faltered following Rachel Reeves’ plan. October Budgetin which businesses bore the brunt of £40bn of tax rises.
An increase in employer social security contributions and an increase in the minimum wage have combined to leave some sectors facing a sharp rise in costs when the measures come into force in April.
Surveys suggest businesses will try to offset rising costs by cutting jobs, cutting wages or passing them on to consumers by raising prices.
Last week’s figures showed UK GDP grew by just 0.1 percent in November, below economists’ forecasts, after slight contractions in September and October.
The ONS survey-based measure of employment also showed the unemployment rate rose to 4.4 percent in the three months to November, up from 4.3 percent previously, although this measurement has recently become less reliable.