Economy 2030 Inquiry report released

The latest Economy 2030 Inquiry, a three-year project to explore the nature of economic change throughout the UK, has been released.

Responding to the report, the Recruitment and Employment Confederation (REC) Chief Executive Neil Carberry, said, “We support government looking at a refreshed tax strategy that boosts productivity, better backs business investment and encourages entrepreneurialism.

“According to our recent JobsOutlook survey, firms feel more confident again about hiring and about the wider economy which makes it the right time to capitalise on that building confidence.

“The REC has previously argued against raising Employer National Insurance contributions which is simply a ‘tax’ on jobs and therefore a bill on activity rather than profits.

“Certainly, any fall in National Insurance will help labour-intensive sectors which are still trying to recover from the pandemic slump and manage ongoing labour shortages.

“It would be a step in the right direction but is not a significant enough move to make a great difference if it means a National Insurance hike elsewhere in the labour chain, especially at a time of cost-of-living crisis and labour shortages.

“There is also a risk that a rise in National Insurance for higher income self-employed may put off people from working in sectors such as IT and engineering where there are shortages of skilled temporary and permanent staff.

“A more jobs friendly tax strategy is only part of the solution to rocket us away from the pandemic slowdown. We need greater government action, from skills reform to immigration and employment regulation, to get growth going. Tax tinkering will only have the desired impact if it links to a cohesive industrial strategy that encourages businesses out of their cautious state.”

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