Reeves’ Budget Disaster: Employment Plummets as Tax Hikes Crush the Private Sector

 

In a devastating blow to the UK economy, today’s employment figures from the Office for National Statistics (ONS) reveal a catastrophic drop of 109,000 jobs in May 2025, marking the largest single-month decline in five years. This brings the total jobs lost since Chancellor Rachel Reeves’ tax-heavy budget to a staggering 276,000. Unemployment has now climbed to 4.6%, with payroll employment falling for seven consecutive months—a trend unseen outside the pandemic era. To make matters worse, the ONS has admitted to yet another blunder, revising last month’s figures downward due to their own incompetence, further exposing the fragility of the economic landscape Reeves has created.

 

For the first time in decades, barring the unprecedented disruption of COVID-19, UK employment levels have not just stagnated but actively contracted. This is no accident—it’s the direct result of Reeves’ ill-conceived budget, which piled punishing tax increases on businesses and workers alike. Her decision to hike employer National Insurance contributions has proven particularly toxic, strangling small and medium-sized enterprises (SMEs) and forcing widespread layoffs. The hospitality sector, already battered by rising costs, has been hit hardest, with businesses slashing jobs to survive the Chancellor’s fiscal onslaught.

 

The ONS’s latest embarrassment—revising April’s employment figures downward—only compounds the sense of chaos. This isn’t just a statistical hiccup; it’s a damning indictment of an institution failing to keep pace with a crumbling economy. The revised data shows an even bleaker picture than previously thought, with job losses accelerating at an alarming rate. Yet Reeves continues to peddle her budget as a “growth plan,” a claim that now borders on delusional.

 

The Chancellor’s tax policies are grinding the private sector to dust. By raising taxes on jobs and investment, Reeves has created a vicious cycle: businesses cut back, unemployment rises, tax receipts fall, and the deficit grows. Posts on X capture the public’s fury, with one user noting, “Tax something more and you get less of it. That’s also true of jobs as Rachel Reeves has proved.” Another warned of a brain drain, with “a millionaire leaving every 45 minutes” as the wealthy flee her punitive regime.

 

The future looks grim. Reeves’ budget has not only obliterated jobs but also crushed business confidence. Record business liquidations and slowing wage growth signal a deepening crisis. Her refusal to prioritise growth—dismissing the need for a coherent plan in favour of “stability”—has left the economy rudderless. As one X user put it, “Raising employers NI was the worst tax to increase. Businesses are cutting back investment and employment. Entirely predictable.”

 

Reeves’ tenure as Chancellor is shaping up to be a masterclass in economic mismanagement. Her tax hikes have sparked an employment crisis, exposed the ONS’s incompetence, and set the stage for a prolonged private-sector collapse. With inflation creeping up and tax receipts dwindling, the UK is hurtling toward a fiscal cliff. The question isn’t whether Reeves will face the sack—it’s when.