Confidence among British bosses tumbles ahead of General Election

Confidence among British bosses has tumbled ahead of the General Election as hiring and investment plans slide.

In a dreary survey published today, the Institute of Directors (IoD) said its economic confidence index – which measures bosses’ optimism in the economy – slumped to a four-month low.

The figure fell to -14 in June, down from -3 in May.

It came as some 10 per cent of business leaders said they were ‘very pessimistic’ about the wider UK economy last month, with just 1 per cent ‘very optimistic’.

Anna Leach, chief economist at the IoD, said the figures were ‘disappointing’ and reflected the falling investment plans amongst bosses, as well as sluggish hiring in the coming year. She added that the Election meant firms were reluctant to make commitments during a time of political uncertainty.

The figures come just days before the country goes to the polls, with surveys predicting a landslide victory for Labour.

But some business leaders have flagged concerns over some of Sir Keir Starmer’s policies, including overhauling workers’ rights and a North Sea tax raid.

Labour plans to introduce a raft of pro-worker regulations, including scrapping zero-hour contracts, quicker access to statutory sick pay and a ‘right to switch off’.

But top industry figures have slammed these policies over fears that changes could cripple thriving UK firms. In April, Sir Martin Sorrell, chief executive of S4 Capital, called the policies ‘Labour’s Achilles heel’.

And Archie Norman, chairman of Marks & Spencer, said changes could mean Britain will struggle to attract investment.

The Institute for Fiscal Studies (IFS) last week said Labour’s ‘new deal for working people’ would raise costs for firms, forcing many to cut wages or hours.

It said: ‘For some employees – such as those who particularly value paid sick leave or the right to take paternity leave – that trade-off will be welcome, for others it might not be.’

The oil and gas industry has also railed against Labour’s plans for a ‘proper windfall tax’ on the North Sea, which would see the rate hiked from 75 per cent to 78 per cent. The rise could lead to the loss of 100,000 jobs according to investment bank Stifel.