A new economic forecast projects that Britain could lose more than 160,000 jobs this year as elevated energy costs and weak economic growth place mounting pressure on manufacturers, builders, retailers, and lower-income households.
By yourNEWS Media Newsroom
Britain’s slowing economy and rising energy costs are expected to eliminate more than 160,000 jobs this year, according to projections from a leading economic forecasting group that uses the same modeling framework as the British Treasury.
The ITEM Club forecast, reported by The Times of London, estimates that approximately 163,000 positions are at risk as businesses continue grappling with weak economic growth and higher operating costs tied to energy markets.
Industries heavily dependent on energy consumption, including manufacturing and construction, are expected to experience the largest employment losses. Economists also warned that the effects are likely to spread into consumer-facing sectors such as retail and hospitality as household spending power weakens.
The forecast comes amid continued debate in Britain over rising energy costs and the economic impact of the country’s climate and net-zero policies under the Labour Party government.
Despite ongoing geopolitical instability involving conflicts in Iran and Ukraine that have already pushed energy prices higher globally, the British government proceeded with scheduled increases to the Climate Change Levy. According to the UK government, rates on electricity and gas increased by 3.4 percent last month and are scheduled to rise further next year, resulting in a cumulative increase of 6.7 percent.
The ITEM Club forecast predicts unemployment could increase by an additional 0.4 percentage points this year, adding to the existing unemployment rate of 4.9 percent.
Economists said the burden is expected to fall disproportionately on industrial regions and lower-income communities where families generally have fewer financial reserves to absorb rising costs.
ITEM Club adviser Tim Lyne said consumers in lower-income areas “typically have less rainy-day savings, which will reduce spending in the retail and hospitality sectors.”
Higher electricity and fuel costs have become a growing concern for British businesses already facing weak domestic demand and sluggish economic expansion. Manufacturers and construction firms, which rely heavily on energy-intensive operations, are expected to face increasing pressure from both utility costs and reduced consumer spending.
The warning also intensifies political scrutiny surrounding Britain’s broader net-zero transition policies, with critics arguing that environmental levies and regulatory costs are worsening financial strain on businesses and households during a period of economic uncertainty.
Supporters of the government’s climate strategy maintain that long-term investment in cleaner energy infrastructure is necessary to reduce dependence on volatile international fuel markets and improve long-term energy security.
The latest forecast, however, suggests many businesses and workers may face immediate economic hardship before those longer-term goals materialize.
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