The government has made growing the UK’s economy a key objective, but recent figures indicate the economy saw zero growth between July and September, while it contracted during October.
Businesses have warned that Budget measures, such as the rise in employer National Insurance contributions, together with the higher National Living Wage could lead to job cuts and price rises.
Rupert Soames, chair of the Confederation of British Business (CBI), said the picture was “not good” but insisted that firms and investors were still somewhat upbeat.
“I wouldn’t say confidence is gone,” he told the BBC’s Today programme. “I’d say it’s bruised.”
However, he said the government was making the situation worse by introducing the Employment Rights Bill, which he said contained “powerful dissuaders to employment”.
Unions argue the protections introduced in the bill, such as banning fire and rehire, make employees safer, while the government has said it “represents the biggest upgrade in employment rights for a generation”.
However, Mr Soames said the Bill would lead to job losses. “Businesses will not only not employ, they will let people go,” he said.
As part of its push for growth, the government revealed plans on Monday to make the UK the global capital of artificial intelligence through measures such as building a new supercomputer.
Prime Minister Sir Keir Starmer said the technology has “vast potential” for rejuvenating UK public services, but the Conservatives called the plans “uninspiring” and criticised Labour’s “economic mismanagement”.
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