The boss of Sainsbury’s has urged the government to tackle the UK’s youth unemployment crisis, as he hit out at previous hikes to the cost of hiring workers.
Simon Roberts, chief executive of the UK’s second-largest grocer, said John Healey must “focus on doing the right thing for young people” at next week’s Budget.
In recent weeks, retail and hospitality bosses pledged to provide thousands of work opportunities to stem the rising number of young people who are not in education, employment or training (Neet).
Sainsbury’s, which has promised to create 10,000 work experience opportunities for Neets, said the government must match businesses’ commitments by ruling out further costs for firms.
Roberts told reporters: “It’s so important that we don’t see any repeat of what we’ve seen in previous budgets, particularly the impact on the tax on employing people through national insurance, or any other costs in the industry that are going to cause food inflation.
“Now there’s a real opportunity and challenge to make sure that together, across business and government, we solve the youth employment crisis in the UK.
“I hope we’ll see from [the] government real support to enable more organisations, more businesses, to focus on doing the right thing for young people.”
The Sainsbury’s boss said the hikes to employer national insurance contributions (NICs) implemented by Healey’s predecessor, Rachel Reeves, “brought a lot of impact to the retail sector”.
Retail bosses have urged the Chancellor to unwind some of Reeves’ increases to the tax. Helen Dickinson, chief executive of the British Retail Consortium, said doing so could “turn the tide on unemployment”.
Resist more tax rises, Sainsbury’s urges
Roberts called on the government not to pile further cost hikes onto “an industry that’s already heavily taxed”.
“Our ask is to make sure that we don’t do anything to further aggravate that situation and [to] make sure that we’re working hard to bring down the cost of employment.”
Last week, the bosses of retailers including Sainsbury’s and Tesco met with Healey, urging the Chancellor to reform the business rates system and take more action to bring down the number of Neets.
Roberts said he is confident that Andy Burnham’s government is “listening to business”.
Shares in Sainsbury’s slipped nearly four per cent on Thursday after the grocer posted slowing sales growth and warned that shoppers are facing “tough” cost-of-living pressures.
But Roberts said price rises in the run-up to Christmas will be softer than feared. Industry figures had expected food inflation to soar as high as 10 per cent this year, though prices are now expected to peak at 6.4 per cent next summer.
He said: “Over the first part of this year, inflation hasn’t really moved anything like some of the forecasts that were out there, which is obviously good news for customers.”