RACHEL Reeves dealt a blow from business chiefs who expect the UK economy to decline over the next year, a major survey reveals.
The Chancellor is warned that one in four company bosses expect a downturn compared to just 13 per cent last year following tax-raising measures.
The findings come as Ms Reeves heads to Davos tomorrow amid the new threat of tariffs from Donald Trump as he tries to seize Greenland.
Nearly four in ten bosses, some 38 per cent, are expecting economic growth but is a sharp drop on the 61 per cent from last year, the PwC Global CEO survey reveals.
The UK remains the second most important destination for investment BUT both Germany and India now share the ranking spot.
Measures brought in by Labour including hikes to national insurance contributions have hampered investment and hiring plans.
Shadow Business Secretary Andrew Griffith said: “The damage the Chancellor has done to confidence is clear with almost double the number of bosses expecting the UK economy to decline as a year ago.
“There are real issues with the U.K. attracting top talent thanks to Rachel Reeves’s tax changes.
“If a top boss got this feedback they’d be calling the headhunter before they were pushed.”
Richard Tice, Reform UK deputy, said: “What a terrible indictment of the damage Labour have done to business confidence.”
The study also finds that half of UK business chiefs raise concerns over whether their firms are transforming quickly enough.
A third say firms have to deal with too much red tape while only one in five, some 22 per cent, say their organisation gives the green light to high-risk innovation projects.
The UK remains the second most important destination for investment BUT both Germany and India now share the ranking spot.
Marco Amitrano, Senior Partner of PwC UK, said: “It demonstrates that the UK still looks stable in a turbulent world.
“But in now sharing that position it’s also a wake-up call – other countries are gaining ground and working hard to market themselves globally.
“As a leading nation, this now points to the need to step up our game, with government and business working together.
“This means action to support growth sectors, make the most of trade opportunities, and provide the consistency and clarity that underpins investor confidence.”
UK bosses revealed that the are likely to be less exposed to tariffs than their counterparts.
PwC quizzed 4,454 company bosses across 95 countries and territories from 30 September to 10 November last year.
A Treasury spokesman said: “Global CEOs know that Britain is one of the best places in the world to do business and it’s clear to see why.
“This country is a haven of stability in an uncertain world.
“We have world class talent, are delivering long term investment, backing our entrepreneurs with tax incentives, and ripping up burdensome regulation so they can build locally and scale globally.”