Tax a thing and you get less of it. It is the oldest rule in economics, and Labour has just proved it again. After hiking employer National Insurance, the government is now watching unemployment climb to 5 percent while job vacancies collapse to their lowest level in five years. This was entirely predictable. Many of us predicted it.

A Tax on Jobs Costs Jobs

In April 2025, Labour raised employer National Insurance contributions — a direct tax on the cost of employing people. The Chancellor called it a budget for growth. In reality it was a budget for the dole queue. When you make every worker more expensive, businesses hire fewer of them. The jobs tax did exactly what a jobs tax does.

The Bank of England's own survey found that 44 percent of businesses cut staff as a result. Nearly half. These are not abstract figures. These are real shifts cancelled, real apprenticeships not offered, real young people told there is no vacancy after all.

The Vacancies Are Vanishing

By April 2026, the number of job vacancies had fallen to its lowest level in five years — and outside the pandemic, the lowest in more than a decade. Fewer vacancies means fewer chances for people to get on, move up, or get back into work. The ladder is being pulled away just as families need it most.

A confident economy creates openings. A taxed and burdened economy closes them. Labour inherited a recovering jobs market and smothered it with costs and red tape.

Long-Term Unemployment Is Back

Most alarming of all, 474,000 people are now long-term unemployed — out of work for more than a year — the highest figure since January 2016. Long-term unemployment is a scar. The longer someone is out of work, the harder it becomes to get back in. Labour is writing off a generation of workers to pay for its own spending.

What Reform UK Would Do

Reform UK would scrap the jobs tax and back the businesses that create work. We would lift the burden of National Insurance on employers so they can afford to take people on, and we would cut the red tape that strangles small firms. Work should always pay, and hiring should never be punished.

Labour chose to tax jobs and got fewer jobs. Reform UK would back British workers and the firms that employ them. It really is that simple.