Chamber calls for Budget action as cost pressures hamper job market

Business leaders today warned conditions remain challenging for many West Midlands businesses - as the latest labour market figures show falling employment and rising economic inactivity in the region.

The employment rate in the West Midlands fell to 73 per cent in the three months to June 2026, down 0.7 per cent on the previous quarter, according to the Office for National Statistics (ONS).

Unemployment rose to 5.6 per cent, while economic inactivity increased to 22.7 per cent - up 0.6 per cent on the previous quarter and 1.1 per cent on the year.

Meanwhile, job vacancies in the UK fell to their lowest level in more than five years as smaller businesses cut back on recruitment.

Vacancy numbers dipped slightly over the May-to-July period to 707,000.

Emily Stubbs (pictured), head of policy at Greater Birmingham Chambers of Commerce, said: “The latest labour market figures suggest conditions remain challenging for many businesses in the West Midlands.

“Employment has edged down, unemployment has risen slightly and economic inactivity continues to increase, while vacancies remain subdued.

“This reflects the wider concerns being raised by businesses across the country. Rising labour costs and other operating expenses are making it harder for firms to invest, recruit and plan for growth, despite continuing demand for skills in many sectors.”

With the Government preparing its Autumn Budget, the GBCC is calling for targeted measures to support recruitment and investment, including an employer National Insurance contribution cut for under-25s and a package of support on energy costs and business rates.

Emily Stubbs added: “As the Government prepares its Autumn Budget, businesses need targeted measures that support recruitment and investment.

“This should include an employer National Insurance contribution cut for under-25s to help firms create more opportunities for young people entering the workforce, and a package of support on energy costs and business rates to give businesses greater confidence to invest and grow.

“Businesses want to invest and create jobs, but they need the right conditions to do so.

“The Autumn Budget is an opportunity to provide that certainty and put growth back on the front foot.”

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