The European Leaders
16 April 2025
England – If 2024 gave British employers a bruising, 2025 may well be the knockout round. Job cuts in the UK are accelerating across industries from high-street retailers to healthcare institutions, leaving workers anxious and employers recalibrating under weighty cost burdens.
With redundancies rising faster than inflation and optimism shrinking like store footprints on the high street, the nation’s workforce is bracing for a tumultuous year ahead.
A Nation on Edge: The Scale of the Cuts
The numbers don’t lie and they don’t comfort either. Between November 2024 and January 2025, 124,000 redundancies were logged a noticeable uptick from the previous quarter and the highest since the pandemic-era shockwaves.
Forecasts predict over 200,000 job losses this year, the brunt of which is being felt in retail, education, technology, and healthcare. In March alone, the UK shed 78,000 jobs. It’s a bleak milestone in a labour market that was just beginning to stabilise.
| Sector | Notable Job Cuts/Trends | Key Drivers |
| Healthcare (NHS) | NHS England to cut around 6,500 jobs (nearly half its workforce) as part of a government shake-up | Streamlining, cost-saving, reducing duplication |
| Retail | Up to 202,000 job losses expected in 2025; 169,395 retail jobs already lost this year | Higher business rates, minimum wage hikes, costs |
| Higher Education | Thousands of university jobs cut; e.g., University of Dundee (632), Sheffield (400), Nottingham (258) | Financial crisis, falling student numbers |
| Technology & Media | Sky to cut 2,000 jobs; Dell to cut 10% of workforce; HSBC layoffs at manager level | Cost-cutting, restructuring, digital transition |
| General Workforce | 124,000 redundancies in three months to Jan 2025; job market cooling, fewer openings | Economic slowdown, tax hikes, automation |
(Sector Breakdown of Job Cuts in the UK)
At the same time, job openings have slipped beneath pre-pandemic levels for the first time in four years. The equation is simple: fewer roles, more insecurity.
Why is Job Cuts in the UK Happening?
Employers are navigating a perfect storm of cost and complexity:
- National Insurance Contributions are up from 13.8% to 15%, and the earnings threshold at which employers start paying has dropped to £5,000 dramatically increasing payroll burdens.
- The National Living Wage has climbed to £12.21/hour, a 6.7% jump, pushing up costs in labour-heavy sectors.
- Business rates relief has been slashed, taking a further £2.3bn out of the hands of struggling companies.
- On top of that, consumer spending remains cautious amid inflationary pressure, while digitalisation continues to phase out roles across customer service and administration.
Add the NHS and university sector restructurings, plus cautious fiscal policy from Westminster, and you’ve got a labour market being sanded down at both ends.
Workers Respond: Ready, Not Waiting!
Unlike previous downturns, UK workers aren’t standing still.
A growing number about 40% are boosting their savings buffers. Many are taking the opportunity to upskill, enrol in online courses, or even dip their toes into freelancing and side gigs to hedge against redundancy.
Mental health is front-of-mind too. With 61% believing job hunting will be tougher in 2025 than last year, there’s a quiet urgency behind updating CVs, networking on LinkedIn, and securing references. It’s not panic it’s preparation.
Still, their concerns are well-founded: 58% expect further job cuts, and more than half anticipate a deteriorating labour market. The main fears? Salary stagnation, diminishing job security, and a noticeable decline in remote work opportunities, as employers steer back toward office mandates.
Retail in Crisis: A Familiar Tale Gets Worse
If there’s a sector that encapsulates the UK’s employment angst, it’s retail. Familiar names are shrinking fast.
- Morrisons has put 365 jobs on the line in March, closing cafés, kitchens, and convenience outlets. That follows more than 200 cuts in January.
- Sainsbury’s axed 3,000 roles, effectively shutting down its in-store café and food counters.
- Tesco, Aldi, and Ocado have also made redundancies or signalled imminent cuts.
Fashion retailers and department stores are following suit. From River Island to The Body Shop, companies are tightening belts and shutting doors. The British Retail Consortium warns this could be the worst employment crisis in the sector since the 1990s.
The Wider Cost Picture: Taxed and Tightened
Behind the scenes, 2025 is shaping up to be a costly year for business operations:
- Capital Gains Tax for business disposals has jumped to 14% and is slated to rise again next year.
- HMRC interest charges have increased, adding financial pressure to businesses already operating on thin margins.
- Private schools have lost VAT exemptions and charitable business rates relief, triggering cost cuts across education.
Even with modest increases in Employment Allowance and a 15% minimum tax rate for large multinationals, smaller and labour-intensive firms are facing uphill battles.
Employers Pivot, But to What?
Companies are responding with strategic hiring freezes, streamlined operations, and deeper automation. The tech sector—ironically both a disruptor and a victim—has seen layoffs at Dell, which cut 10% of its workforce, while Sky shed 2,000 customer service jobs.
In public services, NHS England is trimming 6,500 roles. Universities across the country are restructuring to plug budget shortfalls, resulting in hundreds of academic and support job cuts.
A Nation Resilient, But Weary
There’s no sugar-coating it: Job cuts in the UK are cutting deeper in 2025. With key sectors in retreat and workers rearming themselves with savings, skills, and CVs, the national mood is wary but not defeated.
Britain has weathered employment storms before. But the next few quarters will test how agile, adaptive, and forward-thinking both businesses and employees can truly be.
If the past is any guide, resilience will win out. But for now, every payslip and policy change matters just a little bit more.
Have a thought on this job market downturn? How are you preparing?
