Jobs apocalypse: Britain’s biggest firms cut more than 130,000 roles in two years

Since the Labour Party assumed power in July 2024, Britain's largest corporations have collectively dismissed more than 130,000 employees, according to an analysis by City AM. The study compiled over 250 separate reports of job cuts and plant closures from major businesses during this period. Key organizations affected include car manufacturer Jaguar Land Rover, which announced potential job losses of up to 4,000 positions; Whitbread, the hospitality chain that cut 3,800 jobs; and supermarket giant Sainsbury's, which downsized its workforce by 3,000 employees.

These layoffs have occurred amidst a significant rise in employment costs, including higher national insurance contributions, minimum wage increases, and stricter employment regulations. Chancellor John Healey is expected to further raise the minimum wage at the upcoming Budget, adding to the financial strain on businesses.

The impact of these job losses is most pronounced in the retail and hospitality sectors, which account for about 45,000 of the total job cuts. This sector saw thousands of store, pub, and restaurant closures over the past two years, leading to a higher redundancy rate of around five redundancies per 1,000 employees in September 2025, up from just two redundancies per 1,000 employees in September 2023.

Government data shows that the UK's unemployment rate has crept up from five percent in the first half of 2026 to around four percent when Labour took office. Vacancies also fell below 700,000 for the first time in five years in September. However, the concern for policymakers is the growing number of young adults, or "Neets," aged 16 to 24 who are neither in employment, education, nor training, now totaling nearly 1 million.

Ben Caswell, a senior economist at the National Institute of Economic and Social Research, attributes part of this trend to increased National Living Wage and National Insurance contributions, which have made hiring entry-level staff more challenging. For these young workers, a 10 percent rise in hiring costs due to a single year's increase in unit labor costs poses a significant barrier to employment.

Insolvency expert Molly Monks of Parker Walsh noted that hospitality firms face particularly tough challenges due to their slim profit margins and reduced customer footfall, creating a rapid downward spiral that is difficult to recover from. Factors such as rising business rates, rent, and increased employee costs are contributing to the financial difficulties faced by many companies in this sector.