Autumn Budget 2024, A Year On  Reviewing a budget that continues to pose economic challenges

It feels like a considerable amount of time has passed since the publication of my first article with the Institute of Directors back in early July (1).

This is probably a reflection of the number of significant data releases and announcements that have appeared in the news cycle since then.

In this article I will be taking time to digest and reflect upon the most significant items during that period, before looking ahead to the Autumn Budget in my next piece for the Institute.

IoD England Director of the Year Awards

I would like to start on a positive note by announcing that I have been named as a finalist in this year’s IoD England Director of the Year Awards!

Being recognised by such a prestigious organisation as the Institute of Directors is a great honour. I am already looking forward to the finals, which take place at the Grand Hotel in Birmingham on November 14^th.

It is hugely satisfying to be named as a finalist in the Innovation category. The recognition is a result of the JMAC team’s ground-breaking work with the FinTech, Hope Macy, for whom we have developed a credit rating tool for use by lenders operating within the financially vulnerable consumer finance space. The solution uses Open Banking transactional data, leaning on traditional credit scoring methodologies alongside Artificial Intelligence (AI).

I am only too aware of the highly competitive nature of the awards; such is the vast array of talent within our membership. Despite the exceptional quality of the competing finalists, I maintain hope of being named a winner at the event.

Furthermore, the Director of the Year Awards nomination was recently followed by another piece of exciting news. On September 15^th I was named as a Tech Innovator of the Year finalist at this year’s Credit and Collection Technology Awards. Meanwhile, the product itself was also named a finalist in the Open Banking in Credit & Collections Solution category.

It is fair to state that it has been a hugely satisfying period for the JMAC team on the awards front!

Payroll taxes continue to cause hardship

On a more sombre note, the concerns raised by IoD members after last year’s Autumn Budget continue to be justified by recent data releases, further supporting the findings reported in my last piece.

Firstly, as predicted, private sector employment continues to fall (2). Meanwhile, public sector employment levels continue to grow unchecked (3).

As we expected, employment levels have fallen most dramatically within those sectors known to provide the greatest opportunities for graduates or entry-level staff. The hospitality sector, having lost more than 108,000 jobs over the 12 months since the 2024 general election (4), has borne the brunt of this.

Furthermore, pay awards have fallen for those fortunate enough to gain entry-level employment (5), as forewarned by our membership.

With job vacancies continuing to fall (6), the immediate outlook for those seeking entry and / or graduate level employment is becoming as challenging as our members predicted. Meanwhile, forward guidance from survey data, including from the Bank of England (7), suggests that challenging labour market conditions are likely to continue for the foreseeable future.

Unfortunately, as anticipated, pay settlements within the private sector have fallen. As such, public sector pay now exceeds the private sector by a noticeable margin (8).

Public sector productivity flat, welfare unchecked

Above market pay settlements for the public sector comes despite the ongoing struggles of the private sector, upon which pay awards within public services are dependent. Improving public sector productivity, as repeatedly called for by the IoD (9), remains absent from the policy agenda.

In the intervening period, the government’s limited attempts at welfare reform were unceremoniously thwarted by the governing party’s backbenchers. This episode was widely interpreted as being the key driver of the change of leadership at the Department for Work and Pensions, announced during the recent cabinet reshuffle (which I cover in more detail below).

However, the resultant inaction has stymied any immediate attempt at limiting the impact of the ongoing rise in private sector unemployment upon future welfare spending.

Moreover, the impact is largely yet to be felt and comes alongside the news that Universal Credit (UC) claims surpassed 8 million this summer (10), representing an increase of ~1 million since the 2024 election, and with a marked increase in the 50+ age cohort (11).

Are entrepreneurs departing?

On an additional note, we are now starting to see evidence emerging to support our members’ fears of increasing numbers of business owners leaving the UK.

While the accuracy of reports of High-Net-Worth (HNW) individuals departing the UK by Henley & Partners (12) has been questioned in some quarters, Companies House recently reported a 79% increase in Company Directors changing residence from the UK to overseas since the 2024 budget (13), most likely to more business-friendly jurisdictions.

Anecdotal evidence from conversations with business owners and entrepreneurs within our immediate business community indicates that this trend is likely to continue.

Changing tack

Moving away from the immediate consequences of the 2024 budget, a couple of noteworthy items were captured within the news cycle that further support the need for material reform across Education, Immigration, and Welfare, areas that were also highlighted in my piece in July.

OBR intervenes on immigration policy

An immediate requirement to address the intersection of Welfare and Immigration policy is reflected by the ~1.3m non-UK nationals now understood to be in receipt of Universal Credit (14).

The news preceded warnings from a senior member of the Office for Budget Responsibility (OBR) of the UK’s over-reliance on overseas labour at the expense of domestically focussed training efforts (15).

The intervention came almost a year after the release of OBR analysis, which estimated the lifetime net cost to the exchequer of the average low-wage migrant worker to be in the order of £1.5m (16). The lack of material change in government policy during the intervening period has been reported, in some quarters, to have driven what is a highly unusual intervention from a senior official.

Such eye-watering figures would ordinarily be treated with suspicion by the JMAC team, in the absence of a peer review by one of our specialist consultants. However, the underlying theme of the OBR’s message chimes closely with the conclusions of several studies performed in recent years across other major European economies, including Denmark, The Netherlands, Sweden, and most recently, Finland.

I can confidently predict that similarly concerning empirical evidence will continue to emerge in the coming years. It is interesting to note, such is the strength of the evidence that has emerged to date, that some of the strongest proponents of such policies within the establishment media have recently been forced to reconsider their worldview (17).

The analyses that have been performed to date, alongside those likely to emerge in the future, only serve to underline the potential future economic and social costs of the immigration policies pursued by each of the UK’s governing parties since the experiment was initiated under the New Labour administration in the early noughties.

Reform of higher education and its funding model is long overdue

In other news, over 630,000 University graduates are now understood to be in receipt of Universal Credit (18). This figure is only likely to increase in the coming months unless a dramatic improvement in the labour market takes hold. Consequently, this will lead our young people to further question the “value add” of the UK’s higher education system.

As I pointed out back in July, the need to refocus on vocational skills and apprenticeships is long overdue. The UK economy and our young people continue to suffer the long-term consequences of the New Labour administration’s expansion of the higher education system. Meanwhile, the failure of successive “Conservative” administrations to introduce meaningful levels of reform, or appropriate incentives to the sector, is only one of a series of policy failures from the party’s 14 years in government.

One might rightly question the sustainability and fairness of a system where the taxpayer retains a 100% liability to the Student Loans Company, regardless of graduate outcomes. We recommend a system where a proportion of liability instead sits with higher education course providers should they consistently fail to ensure positive employment outcomes for their students.

Such an approach would likely introduce more competition into the sector and require institutions to be more adept in meeting the challenges posed by a changing labour market, not least due to AI.

More Freedom of Information requests please!

Several of the data points referenced above are drawn from Freedom of Information (FOI) Act requests, applied for largely by journalists from within the new media space. One might rightly question why this approach has not been adopted previously by the legacy media and its core of client journalists.

However, the recent progress that has been made in this regard is very welcome to those of us that are keen to see an evidence-led policy framework in the future. It is therefore a credit to both the journalists themselves and the small number of hard-working politicians that have supported their work. However, one might also question why meaningful oversight of the impact of government policy has not been pursued more rigorously in the past. This is especially baffling given the continued presence in parliament of upwards of 650 members of apparently varied political persuasions.

Having been introduced during the first term of the New Labour administration, it is somewhat curious that the then PM has since described the introduction of FOI requests as “one of his greatest mistakes” (19). This is a striking admission given both the ongoing impact of the New Labour administration’s time in power, and the levels of transparency that the Act itself enables on behalf of the electorate.

A changing political climate?

That the previous UK “Conservative” administration was either unwilling or unable to overturn the policy framework it first inherited in coalition in 2010 does not reflect positively on the party. In our view, this is a major contributor to the party’s low polling levels, which has persisted for several months (20). It is noteworthy that, at the time of writing, bookmakers are offering odds of up to 7-1 for the party to emerge as the largest at the next general election.

While the struggles of its traditional political opponent should provide great comfort to the government, the incumbent administration instead finds itself consistently polling significantly behind an insurgent Reform Party.

With the next general election still up to 4 years away, there should be plenty of time for the administration to turn the situation around.

However, to be trailing a recently formed political party, with only five sitting MPs at the time of writing, highlights the need for a business-friendly budget this Autumn.

Let’s hope that Number 11 gets it right this time.

What next?

With the Autumn Budget set for Wednesday November 26^th, in my next article I will look forward, if that is the correct phrase to use, to the event and the potential impact on the membership.

Furthermore, I will be looking deeper into the economic climate and assessing the way ahead for our members.

References

1. Institute of Directors. (2025, July). SMEs under pressure: Influencing policy with the IoD in an uncertain economic climate. https://www.iod.com/locations/south/surrey/news/smes-under-pressure-influencing-policy-with-the-iod-in-an-uncertain-economic-climate/
2. Office for National Statistics. (2025, September). UK labour market: September 2025. https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/uklabourmarket/september2025
3. Office for National Statistics. (2025). Public sector employment, UK: Time series (g7g3). https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/publicsectorpersonnel/timeseries/g7g3/pse
4. Office for National Statistics. (2025, August). Earnings and employment from Pay As You Earn Real Time Information, UK: August 2025. https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/bulletins/earningsandemploymentfrompayasyouearnrealtimeinformationuk/august2025
5. City A.M. (2025, August). Starting pay growth at slowest pace since 2021. https://www.cityam.com/starting-pay-growth-at-slowest-pace-since-2021/
6. Office for National Statistics. (2025, September). Jobs and vacancies in the UK: September 2025. https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/jobsandvacanciesintheuk/september2025
7. Bank of England. (2025, August). Decision Maker Panel: August 2025. https://www.bankofengland.co.uk/decision-maker-panel/2025/august-2025
8. Statista. (2025). Wage growth in the United Kingdom (UK) in 2024, by industry sector. https://www.statista.com/statistics/800658/wage-growth-uk-by-industry-sector/
9. Institute of Directors. (2025). IoD press release: Increasing public sector productivity must be government’s top priority for the spending review. https://www.iod.com/news/uk-economy/iod-press-release-increasing-public-sector-productivity-must-be-governments-top-priority-for-the-spending-review/
10. Department for Work and Pensions. (2025, July). Universal Credit statistics: 29 April 2013 to 10 July 2025. https://www.gov.uk/government/statistics/universal-credit-statistics-29-april-2013-to-10-july-2025/universal-credit-statistics-29-april-2013-to-10-july-2025
11. City A.M. (2025, August). Economy faces midlife crisis as benefit claimants hit new high. https://www.cityam.com/economy-faces-midlife-crisis-as-benefit-claimants-hit-new-high/
12. Business Insider. (2025, August). Millionaire migration booms: Top countries attracting wealth in 2025. https://www.businessinsider.com/millionaire-migration-booms-top-countries-attracting-wealth-in-2025-2025-8
13. City A.M. (2025, August). Wealth exodus ramps up as bosses quit UK. https://www.cityam.com/wealth-exodus-ramps-up-as-bosses-quit-uk/
14. LBC. (2025). Keir Starmer: Foreign nationals on Universal Credit. https://www.lbc.co.uk/article/keir-starmer-foreign-nationals-universal-credit-5Hjd7Lp_2/
15. Don’t Stop Thinking About Tomorrow. (2025). Don’t stop thinking about tomorrow [Report]. https://www.dontstopthinkingabouttomorrow.co.uk/dont-stop-thinking-about-tomorrow.pdf
16. Migration Observatory. (2025). The fiscal impact of immigration in the UK. https://migrationobservatory.ox.ac.uk/resources/briefings/the-fiscal-impact-of-immigration-in-the-uk/
17. The Economist. (2025). Your guide to the new anti-immigration argument. https://www.economist.com/finance-and-economics/2025/03/13/your-guide-to-the-new-anti-immigration-argument
18. The Telegraph. (2025, July 28). More than 630,000 graduates on benefits. https://www.telegraph.co.uk/news/2025/07/28/more-than-630000-graduates-on-benefits/
19. The Guardian. (2011, September 20). Mixed results: Blair’s dangerous act. https://www.theguardian.com/politics/2011/sep/20/mixed-results-blairs-dangerous-act
20. The Independent. (2025). Conservatives YouGov poll: Labour, Lib Dem, Reform. https://www.independent.co.uk/news/uk/politics/conservatives-yougov-poll-labour-lib-dem-reform-b2754230.html

This is a guest article which contains views of the author and does not necessarily represent the views of the IoD.