Good intentions don’t create jobs – businesses do

I’ve built businesses from nothing. No safety net, no guaranteed income, no government cushion. Just hard graft, risk, and the belief that if you create value, you create jobs. And I’ll tell you a simple truth that every entrepreneur understands instinctively: employers hire when it feels safe to hire. Right now, it doesn’t.

This isn’t about ideology. It isn’t about party politics. It’s about risk and reward. When the balance tips too far towards risk, hiring slows down. It’s as simple as that.

Politicians say they are protecting workers. In reality, they risk protecting people from being hired in the first place.

A recent survey of 2,000 firms found that 37% plan to reduce permanent recruitment because of the government’s new workers’ rights reforms. That isn’t business leaders throwing a tantrum. It’s predictable economics. If you increase the cost and complexity of employing someone, fewer people get employed.

Layer onto that higher National Insurance contributions, day-one sick pay, and easier routes to unfair dismissal claims, and you fundamentally change the calculation for a small or medium-sized business. For a big corporate with deep pockets and an HR department the size of a small town, these changes are irritating. For a small firm running on tight margins, they are existential.

When employing someone becomes a legal and financial gamble, you don’t take the gamble. You hesitate. You delay. You look for alternatives. Politicians say they are protecting workers. In reality, they risk protecting people from being hired in the first place. Because if employing someone feels risky, employers do not magically stop needing work done. They simply change how they get it done. They hire contractors instead of permanent staff. They use agencies. They outsource. They automate. Or they decide not to expand at all. The permanent job disappears before it is even advertised.

That is how a country quietly loses its edge. Not with headline-grabbing unemployment spikes, but with missing first jobs.

This is how growth quietly stalls. Not with dramatic factory closures or mass redundancies, but with opportunities that never materialise. A new branch that is never opened. A trainee role that is never created. A young person who never gets their first shot. That brings me to the bigger warning light flashing on the dashboard: youth unemployment.

For the first time in 25 years, youth unemployment in the UK is higher than in the European Union. That should be setting off alarm bells across Westminster. Instead, we get more regulation, more complexity, and more cost piled onto employers.

Young people are always the first to feel the squeeze when hiring becomes more expensive and less flexible. If you raise wage floors rapidly and increase legal exposure at the same time, employers naturally look for safer bets. They hire experience instead of potential. They choose the candidate who needs the least training and poses the lowest risk.

We also need to talk about where public money is going. The state spends roughly £55,000 supporting the average university degree. By contrast, it spends about £9,000 training an apprentice.

That might make sense for an individual business trying to survive. But collectively, it creates a labour market that struggles to create new opportunities. We end up in a system where it is safer to hire experience than to create it.

That is how a country quietly loses its edge. Not with headline-grabbing unemployment spikes, but with missing first jobs. With school leavers sitting at home, sending out CVs and hearing nothing back. With graduates taking roles that do not require a degree, there are not enough entry-level openings to go around. And then we act surprised.

We also need to talk about where public money is going. The state spends roughly £55,000 supporting the average university degree. By contrast, it spends about £9,000 training an apprentice.

Do the maths. For the cost of one graduate, we could train five or six apprentices. That is five or six young people earning from day one, paying tax, building real-world skills and contributing to the economy immediately. Instead, we push the majority down a single academic route, saddle them with debt, and hope the labour market absorbs them three years later.

University absolutely has its place. We need doctors, engineers, scientists and lawyers. But we have created a culture where vocational training is treated as second best. At the same time, we make it harder and riskier for businesses to take on apprentices and entry-level staff.

It makes no sense.

If you want to reduce youth unemployment, you do not start by tightening the screws on employers. You start by asking what would make them more confident about taking a chance on someone with no experience. You simplify the rules. You provide targeted incentives. You reduce the downside risk for firms willing to train.

The uncomfortable truth is that jobs do not come from Whitehall press releases. They come from entrepreneurs deciding to grow. They come from business owners looking at the order book and thinking, yes, we can afford to bring someone in. They come from confidence.

The UK has always thrived when it backs enterprise. When it rewards risk-taking. When it trusts business owners to do what they do best, which is create value and opportunity.

Right now, confidence is fragile.

Small and medium-sized businesses are already dealing with rising energy costs, inflationary pressures, supply chain uncertainty and cautious consumers. Add in higher employment costs and greater legal exposure, and the rational response is restraint.

Nobody builds a thriving economy by making employers nervous.

If the Government genuinely wants to protect workers, the best protection is a strong, growing labour market where opportunities are plentiful. When jobs are abundant, workers have power. They can move. They can negotiate. They can progress. When jobs are scarce, protection on paper means very little.

We do not fix unemployment by layering on more regulation. We fix it by making it easier, safer and more attractive for businesses to take a chance on someone new.

We need to shift the focus back to growth. That means recognising that businesses are not the enemy. They are the engine. It means understanding that good intentions, however well-meaning, do not create a single job unless an employer is willing to sign a contract and take on the responsibility.

The UK has always thrived when it backs enterprise. When it rewards risk-taking. When it trusts business owners to do what they do best, which is create value and opportunity.

If we continue down a path where hiring feels like a liability rather than an investment, we will see fewer permanent roles, fewer entry-level opportunities and slower growth. And the people who will pay the price first are the very workers politicians say they are trying to protect.

We do not fix unemployment by layering on more regulation. We fix it by making it easier, safer and more attractive for businesses to take a chance on someone new.

Because in the end, it is not good intentions that create jobs. It is businesses.

Charlie Mullins OBE is a forthright, common-sense entrepreneur and one of Britain’s most recognisable business figures. The archetypal self-made founder of Pimlico Plumbers, which he built from scratch and later sold for a reported £140m, Charlie is known for his straight-talking views on enterprise, employment and government policy. He is now chairman of WeFix London, where he continues to champion practical business thinking and opportunities for the next generation of entrepreneurs.

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