Redundancy

Number of planned redundancies in the UK jumps 54 percent in a year amid rising interest rates

Darryl Horn, Thursday, 9 November 2023 • 2 min read

Photo by Andrew Neel Number of planned redundancies in the UK jumps 54 percent in a year amid rising interest rates

The number of planned redundancies in the UK has jumped 54% in the past year, rising from 182,790 in 2021/22 to 280,760 in 2022/23 (year ending October 31), according to specialist employment law firm GQ|Littler.

This is the highest number of planned redundancies since 2009, and it is a sign that the UK economy is coming under increasing pressure from rising interest rates.

The sectors that are most affected by planned redundancies are:

  • Financial services (36%)
  • Technology (25%)
  • Retail (20%)
  • Manufacturing (15%)
  • Construction (10%)

The increase in planned redundancies is likely to have a significant impact on the UK economy, as it will lead to a loss of jobs and a decrease in consumer spending.

Why are rising interest rates leading to redundancies?

Rising interest rates make it more expensive for businesses to borrow money. This can lead to businesses having to cut costs, which can include making redundancies.

In addition, rising interest rates can lead to a decrease in demand for goods and services. This is because consumers have less disposable income to spend when interest rates are high. This can also lead to businesses having to make redundancies.

What can be done to help people who are facing redundancy?

The government has a number of measures in place to help people who are facing redundancy. These include:

  • Jobseeker's Allowance: This is a benefit that can be paid to people who are unemployed and actively looking for work.
  • Universal Credit: This is a benefit that can be paid to people who are on a low income or who are out of work.
  • The Redundancy Payments Scheme: This is a scheme that provides financial support to people who have been made redundant.

Conclusion

The increase in planned redundancies is a worrying sign for the UK economy. It is important that the government and businesses take steps to help people who are facing redundancy.

This article was first published on 9/11/23.

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About the author

Darryl

Darryl is a Chartered CIPD Member, business leader and operational manager with 30 years experience in on-the-ground and strategic HR, specialising in Human Resources Management, Employment Law, Employee Relations and Learning & Development.

darryl@hrdocbox.co.uk

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