Retail leaders met with John Healey at No 11 on Tuesday to press for measures that would make it cheaper to employ young people. Representatives from prominent chains including Tesco, Costa Coffee and the Co-op joined senior executives from other household names to set out the labour-market pressures facing the sector ahead of the chancellor’s first budget.
Attendees described how a recent increase in employers’ national insurance contributions has added to operating costs across hospitality and retail, squeezing margins and complicating recruitment of entry-level staff. Leaders argued that reducing the threshold for employers’ national insurance or otherwise lowering payroll costs for businesses would support hiring and retention, particularly for younger workers entering the labour market. The conversation linked employment dynamics with firms’ capacity to expand shift patterns and open new roles in busy trading periods.
The meeting included senior figures such as Stuart Machin, chief executive of Marks & Spencer, and Simon Roberts, chief executive of Sainsbury’s, who joined other sector representatives to outline operational impacts. Delegates conveyed concerns about the cumulative effect of higher payroll costs on investment plans and on the ability to offer training and progression to junior staff. They asked the chancellor to consider targeted adjustments in his upcoming fiscal package to address those specific pressures.
The exchange at No 11 underlines the lobbying effort underway as the government prepares its next fiscal measures. Retail and hospitality leaders seek changes they say would ease the transition of young people into work, while the chancellor must weigh those appeals against broader fiscal priorities managed by HM Treasury. How the budget responds will be watched by employers, workforce groups and policymakers concerned with youth employment and the resilience of high street businesses. For the sector, any adjustment to payroll taxation could influence hiring decisions over the coming months and the planning of seasonal recruitment drives.
