Major overhaul of business rates needed as firms continue to face recruitment difficulties - Chamber
Midland business leaders renewed pleas for a major overhaul of business rates to ease costs and drive growth as vacancies continue to decrease and new jobless figures revealed a rise in unemployment over the last three months.
Emily Stubbs (pictured), head of policy at Greater Birmingham Chambers of Commerce, again called for business rates reform to help relieve “unrelenting” cost pressures as statistics showed despite signs of a cooling labour market local firms continue to face recruitment difficulties.
New figures out today reveal that from March to May 2024 the regional employment rate declined by 0.5 percentage points to 73.2 per cent, the unemployment rate rose by 0.3 percentage points to 5.2 per cent and economic inactivity rose by 0.4 percentage points to 22.7 per cent compared with the previous three months.
Nationally, in the same period, the employment rate decreased by 0.1 percentage points to 74.4 per cent, the UK unemployment rate rose by 0.2 percentage points to 4.4 per cent and economic inactivity decreased by 0.1 percentage points to 22.1 per cent.
Over the year, the West Midlands employment rate decreased by 1.8 percentage points, unemployment rose by 0.1 percentage points and economic inactivity rose by 2.0 percentage points.
Nationally since the same time last year, employment decreased by 1.1 percentage points, unemployment rose by 0.4 percentage points and economic inactivity rose by 0.8 percentage points.
In April to June 2024, the estimated number of vacancies in the UK decreased by 30,000 on the quarter to 889,000. Vacancies decreased on the quarter for the 24th consecutive period but are still above pre-coronavirus (COVID-19) pandemic levels.
Annual growth in employees' average regular earnings (excluding bonuses) in Great Britain was 5.7 per cent in March to May 2024, and annual growth in total earnings (including bonuses) was 5.7 per cent.
Annual growth in real terms (adjusted for inflation using the Consumer Prices Index including owner occupiers' housing costs (CPIH)) for regular pay was 2.5 per cent in March to May 2024, and for total pay was 2.2 per cent.
Greater Birmingham Chambers Head of Policy Emily Stubbs called for a reduction in costs – including business rates reform – in the wake of the latest labour market figures.
She said: “Vacancies are still falling and wage growth has decreased to its slowest pace for nearly two years, but we will have to wait and see whether this, together with overall inflation figures, is enough for the Bank of England to finally reduce the base interest rate in August.
“Despite signs of a cooling labour market nationally, the Chamber's latest Quarterly Business Report found that almost two thirds of Greater Birmingham businesses continue to experience difficulties recruiting new staff, and three in ten are concerned about labour costs.
“The announcement of measures in the King’s Speech, including plans to get people back into employment post-Covid and reform the apprenticeship levy are very much welcomed as means to hopefully ease these challenges.
“However, to meaningfully increase business investment in training and drive economic growth, the government must directly address the unrelenting cost pressures firms are facing. A good place to start would be to implement their manifesto pledge to reform business rates.”
