The government’s 2025 spring statement has come under fire from the CIPD, the professional body for HR and people development, which warns that the Chancellor’s plans risk undermining business productivity and job creation by failing to address the real workplace challenges faced by employers.
While the Chancellor announced increased funding for defence and infrastructure, CIPD Head of Public Policy Ben Willmott said the statement lacked meaningful support for businesses and failed to tackle the growing cost and complexity of employing staff in the UK.
“While the Chancellor highlighted welcome support for key sectors such as defence and plans to boost investment in infrastructure and housing, there was no recognition of the need to provide more support for employers,” said Willmott.
He warned that recent government moves — including national insurance hikes and the forthcoming Employment Rights Bill — have added costs and regulatory burdens to businesses at a time when they need greater flexibility and support.
“We now need to see the Government back businesses by setting out how it will work with employers to address these challenges and boost productivity, as together these measures stand to undermine business investment in workforce training and employment,” he said.
CIPD data has shown that regulatory uncertainty and rising employment costs are already having a chilling effect on hiring and investment, particularly in skills development. Willmott urged the government to ensure that new regulations under the Employment Rights Bill do not unintentionally deter recruitment — especially of young people and those who need additional support to thrive at work.
“If the Government wants to see more people in work, then there must be jobs for them to go to. It’s important that new regulations don’t deter employers from hiring staff,” he said.
The CIPD also called for a clear implementation plan for the Employment Rights Bill, including additional funding for ACAS and the employment tribunal system, to cope with a likely rise in claims once new rights come into effect.
On skills, Willmott called for urgent action to benefit everyday economy sectors that employ millions across the UK. This includes fast-tracking consultation on the proposed Growth and Skills Levy to give businesses the tools they need to upskill their workforce and tackle labour shortages.
He also urged the government to support the forthcoming recommendations from the Keep Britain Working review — particularly on improving access to occupational health services for SMEs, helping more people stay healthy and in work.
“The Government has been quick to introduce costs, but now is the time to back British businesses,” Willmott concluded. “This means real investment in skills, genuine engagement with employers, and a practical approach to regulation — all essential for driving long-term economic growth and keeping people in good jobs.”
