Confidence among British bosses has fallen ahead of the general election as hiring and investment plans slow.
In a grim survey published today, the Institute of Directors (IoD) said its economic confidence index, which measures bosses’ optimism about the economy, fell to a four-month low.
The figure fell to -14 in June, compared to -3 in May.
It came as around 10 per cent of business leaders said last month they were “very pessimistic” about the UK economy overall, with just 1 per cent “very optimistic”.
Anna Leach, chief economist at the IoD, said the figures were “disappointing” and reflected falling investment plans among employers as well as a slowdown in hiring over the next year. She added that the election meant companies were reluctant to make commitments during a time of political uncertainty.
The best step forward: Labour plans to introduce a raft of pro-worker regulations, including scrapping zero-hours contracts, quicker access to statutory sick pay and a “right to disconnect”.
The figures come just days before the country goes to the polls, and polls predict a landslide victory for the Labor Party.
But some business leaders have raised concerns about some of Sir Keir Starmer’s policies, including a review of workers’ rights and a North Sea tax raid.
Labour plans to introduce a raft of pro-worker regulations, including the scrapping of zero-hours contracts, quicker access to statutory sick pay and a “right to disconnect”.
But senior industry figures have criticized these policies over fears the changes could cripple the UK’s thriving businesses. In April, Sir Martin Sorrell, chief executive of S4 Capital, called the policies “the Achilles heel of the Labor Party”.
And Archie Norman, chairman of Marks & Spencer, said the changes could mean Britain would struggle to attract investment.
The Institute for Fiscal Studies (IFS) said last week that Labour’s “new deal for workers” would increase costs for businesses, forcing many to cut wages or hours.
He said: “For some employees, such as those who particularly value paid sick leave or the right to take parental leave, such compensation will be welcome; for others it may not be.”
The oil and gas industry has also criticized Labour’s plans to introduce an “appropriate windfall tax” in the North Sea, which would raise the rate from 75 to 78 per cent. According to the investment bank Stifel, the increase could lead to the loss of 100,000 jobs.
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