Reeves tax raid pulls in £300m less than expected

Rachel Reeves's tax raid pulled in £300m less than expected during its first two months of operation, the Office for Budget Responsibility (OBR) said.
The Budget watchdog said receipts were lower than forecasts in 'highly provisional' figures which showed the Treasury borrowed more than expected during the month of May.
Companies were hit with a 22pc surge in National Insurance payments last month, the OBR said, after the Chancellor enacted her £25bn National Insurance hike set out in her October Budget last year.
The OBR said PAYE income tax and cash receipts from employer National Insurance contributions were £37.2bn in May, which was £3.2bn more than last year, or 9.5pc higher.
However, it was £200m below the Budget watchdog's forecast for the month.
Public sector net borrowing overall hit £17.7bn in May, according to the Office for National Statistics (ONS), which was £600m higher than the £17.1bn that had been forecast by the OBR.
It was also £700m higher than May last year despite Ms Reeves's Budget tax raid aimed at shoring up the nation's finances.
The rise comes despite central government tax receipts hitting £82.5bn in May, which was £5.3bn more than in the same month last year.
ONS deputy director for public sector finances Rob Doody said: 'Last month saw the public sector borrow £700m more than at the same time last year, with only 2020, affected as it was by Covid-19, seeing higher May borrowing in the time since monthly records began.
'While receipts were up, thanks partly to higher income tax revenue and National Insurance contributions, spending was up more, affected by increased running costs and inflation-linked uplifts to many benefits.'
Darren Jones, the Chief Secretary to the Treasury, insisted the latest borrowing figures showed the Government has 'stabilised the economy and the public finances'.
Treasury borrowing was higher than OBR forecasts in May but was better than expected during the first two months of the financial year.
Public sector borrowing was reached £37.7bn in April and May, which was £1.6bn more than the same period last year but £2.9bn less than the £40.7bn forecast by the OBR.
Mr Jones said: 'Since taking office, we have taken the right decisions to protect working people, begin repairing the NHS, and fix the foundations to rebuild Britain. We stabilised the economy and the public finances; now we need to ensure that the British economy delivers for working people.
'Last week's Spending Review showed how we are investing in the UK's security, health, and the economy through our Plan for Change, so that people are better off.'
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Retail share prices mostly fell today in London, as weak retail sales data and falls in heavyweight oil and drug stocks offset hopes for progress in the Israel-Iran conflict.
B&M fell 3.3pc, JD Sports fell 0.6pc, Next fell 0.2pc and Marks & Spencer were down 0.7pc.
The blue-chip FTSE 100 dipped 0.2pc to hit a more than two-week low, while the mid-cap FTSE 250 index ended 0.4pc higher, though with marginal weekly losses.
For the week, the FTSE 100 closed down 0.9pc, the FTSE 250 ended down 0.1pc and the AIM All-Share ended down 0.6pc.
Stephen Innes, at SPI Asset Management, said Mr Trump's two-week 'thinking window' on whether to join Israel's war against Iran is 'no cooling-off period - it's a ticking volatility clock'.
Ipek Ozkardeskaya, at Swissquote Bank, agreed, stating: 'I'm not sure the US buying itself time can be interpreted as a sign of de-escalation.'
Brent crude traded lower at $76.52 a barrel late from $78.59 on Thursday.
The downward correction saw BP fall 2pc and Shell drop 0.7pc.
Also weighing on London's blue-chip index, a drop in drugs firms GSK and AstraZeneca, which ended 2.2pc and 1.3pc lower. Earlier this week, Mr Trump renewed his threats of tariffs on the sector.
The Government has signed a new partnership with Bahrain that will see £2bn of investment into financial services, clean energy, manufacturing and technology.
Rachel Reeves, the Chancellor, said: 'In a changing world, Britain is increasingly seen as a place for investment and growth - thanks to the stability we have brought to the economy and our pro-business approach.
'This £2bn investment into the growth-driving sectors where Britain thrives will create good jobs paying decent wages in all corners of our country, putting more money in people's pockets as part of our Plan for Change.'
Shares in FTSE 100 landlord Unite have gained 2.2pc after Goldman Sachs said it would benefit from Donald Trump's clampdown on international students.
Earlier this month Mr Trump suspended the entry of foreign nationals intending to study at Harvard and also introduced 'comprehensive and thorough vetting' of anyone applying for a student visa.
Analysts at the banking giant said: 'The recent divergence between US and UK student visa applications could suggest that US restrictions are impacting international student mobility patterns.'
Applications for visas to study in the UK surged 20pc in the first five months of this year.
Global stocks have risen today after President Donald Trump signalled he would hold off on joining Israel's attack on Iran to give negotiations more time.
Mr Trump said yesterday that he will decide whether to join Israel's strikes on Iran within the next two weeks as there is still a 'substantial' chance of negotiations to end the conflict.
The statement sent oil prices lower Friday. Mr Trump had earlier in the week appeared poised to commit the United States to the Israeli military effort.
In Britain, the FTSE 100 is up 0.1pc. Across the Channel, France's Cac 40 is up 0.6pc and Germany's Dax is up 1.3pc.
On Wall Street, the Dow Jones is up 0.3pc, the S&P 500 is up 0.2pc and the Nasdaq is up 0.1pc.
The cost of a barrel of Brent crude dropped 3pc to $76.50.
Fears the Chancellor will raise taxes in the autumn have risen today after official figures showed rising borrowing despite a tax hike.
The Office for National Statistics (ONS) said borrowing surged to £17.7bn last month, the second highest figure on record for May, surpassed only at the height of Covid.
May borrowing was £700m higher than a year earlier.
Experts warned the higher borrowing figures raised the chances of tax hikes to come in the budget later this year, with Rachel Reeves under pressure to balance the books amid rising borrowing and her spending commitments.
Thomas Pugh, economist at audit and consulting firm RSM UK, said he is pencilling in tax increases of between £10bn and £20bn.
He said: 'The under-performance of the economy and higher borrowing costs mean the Chancellor may already have lost the £9.9bn of fiscal headroom that she clawed back in March.
'Throw in the tough outlook for many Government departments announced in the spending review and U-turns on welfare spending and the Chancellor will probably have to announce some top-up tax increases after the summer.'
Danni Hewson, AJ Bell head of financial analysis, said the borrowing figures 'will only add to speculation that the Chancellor will have to announce more spending cuts or further tax increases at the next budget if she wants to meet her fiscal rules and pay for her spending plans'.
'One big shock could wipe out any headroom Rachel Reeves might have, and there are still question marks about how much of GDP (gross domestic product) should be spent on defence and where the money is going to come from,' she added.
Struggling luxury handbag maker Mulberry has revealed talks to raise more than £20m as the group warned it will slump to an annual loss amid worsening trading conditions.
The Somerset-based firm said it was launching the cash call after a 'post-2024-25 year-end review by the executive management, and in light of an even more challenging trading environment'.
'The board has concluded that the company will require additional capital to fund its growth strategy and achieve its desired financial targets,' it added.
Mulberry said it was in discussions with majority shareholder Challice - a group controlled by Singaporean entrepreneur Christina Ong and husband Ong Beng Seng - and major stakeholder Mike Ashley's Frasers Group over the fundraising.
It comes as Mulberry said it expects to slump to an underlying pre-tax loss of around £23m for the year to March 29 against profits of £22.6m the previous year.
The group expects to report annual revenues tumbling 21pc to around £120m, adding that it does expect 'material overall revenue growth' in the new financial year.
Andrea Baldo, chief executive of Mulberry, said the group had taken action to overhaul the business and cut costs as part of plans laid out in January.
River Island has confirmed its plans to shutter dozens of stores as it battles tax rises and a shift to online shopping.
It follows reports that hundreds of jobs are at risk as part of plans to shut 33 of its 230 UK stores. A further 71 stores are also at risk depending on talks with landlords in order to secure improved rental deals.
Ben Lewis, chief executive of River Island, said: 'River Island is a much-loved retailer, with a decades-long history on the British high street.
'However the well-documented migration of shoppers from the high street to online has left the business with a large portfolio of stores that is no longer aligned to our customers' needs. The sharp rise in the cost of doing business over the last few years has only added to the financial burden.
'We have a clear strategy to transform the business to ensure its long-term viability.
'Recent improvements in our fashion offer and in-store shopping experience are already showing very positive results, but it is only with a restructuring plan that we will be able to see this strategy through and secure River Island's future as a profitable retail business.
'We regret any job losses as a result of store closures, and we will try to keep these to a minimum.'
Public sector net debt, excluding public sector banks, stood at £2.87 trillion at the end of May, according to the Office for National Statistics.
It was estimated at 96.4pc of GDP, which was 0.5 percentage points higher than a year earlier and remains at levels last seen in the early 1960s.
The ONS said the sale of the final tranche of taxpayer shares in NatWest, formerly Royal Bank of Scotland, cut net debt by £800m last month, but did not have an impact on borrowing in May.
Interest payments on debt, which are linked to inflation, fell £700m to £7.6m due to previous falls in the Retail Prices Index (RPI).
But recent rises in RPI are expected to see debt interest payments race higher in June.
River Island is expected to put hundreds of jobs at risk under plans to close dozens of its stores.
The family-owned fashion retailer wants to close 33 of its 230 shops under a restructuring plan that will be voted on by its creditors in August, according to Sky News.
It was reported another 71 stores could close after talks with landlords.
It comes after a retail sales declined in May at their fastest rate since December 2023, just as bosses contend with tax rises introduced in April.
River Island has been contacted for comment.
The pound was on track for a weekly loss against the dollar as the uncertainty over the Israel-Iran conflict pushed investors into the safe haven US currency.
Sterling was down 0.6pc versus the greenback over the course of the week. The dollar was set for its biggest weekly rise in more than a month.
It was last up 0.2pc today to just under $1.35 as investors shrugged off concerns about surging Treasury borrowing.
It had edged down on Thursday after the Bank of England's policymakers said they were taking note of Britain's weakening jobs market, even after voting to hold interest rates at 4.25pc.
ING analyst Francesco Pesole said: 'The pound was only lightly touched by a consensus Bank of England hold yesterday.
'Yesterday's 6-3 vote split for a cut can be interpreted marginally on the dovish side and is allowing markets to reinforce their conviction call on an August cut.'
The pound was on track for a weekly drop of 0.4pc against the euro, which is worth 85.4p.
Feeling disgruntled that Keir Starmer did a volte-face on winter fuel payments for pensioners? Earning over £100,000 but strapped for cash at the end of the month? Are you a young professional struggling to build wealth even though you're in a top tax bracket?
Welcome to the world of Henrys (High Earner, Not Rich Yet), a growing group of young workers who are well paid on paper but still feel like they are struggling in Starmer's high-tax Britain.
Henrys often work in lucrative sectors such as technology, law and financial services but feel like they are just getting by because of childcare costs, a growing list of daily expenses and high tax levels that leave them unable to save at the end of the month.
Cuts to day to day departmental spending are 'implausible' amid surging Treasury borrowing, economists have said.
Public sector borrowing hit a record high of £17.7bn for the month of May – barring the pandemic – even as Rachel Reeves's National Insurance tax raid brought in an extra £1.8bn to £15.1bn over the same period.
Rob Wood, chief UK economist at Pantheon Macroeconomics, said the public finances 'are likely to remain under pressure', even as rises in borrowing costs on bond markets predicted to 'only knock around £1bn off the Government's headroom against its fiscal rules'.
He said: 'The 2025 Spending Review outlined the challenges from the expected raft of real-terms spending cuts to Government departments over the coming years based on the total spending envelope.
'Day-to-day expenditure in departments excluding defence and the Department of Health and Social Care will fall in real terms by 0.1pc on average between 2025/26-to-2028/29.
'We still think these cuts remain as implausible now as they were before last week's review.
'Taxes will need to rise — or the fiscal rules changed — if the Chancellor wants to maintain service provision even at current levels across all departments.'
Construction companies were the largest source of corporate insolvencies in the year to April, official data show, as tax rises put up staffing costs.
The sector experienced 4,032 insolvencies over the period, making up 17pc of all cases.
James Hawksworth, a restructuring partner at RSM UK, said: 'Amid rising employers' National Insurance contributions, increases to the national minimum wage, tariffs uncertainty and subdued activity in April, it's no surprise the construction industry continued to experience the highest number of insolvencies among all sectors in the economy.
'For some time now housebuilding in particular has been struggling with tight margins, inflated material and labour prices, heightened regulatory pressures and fixed-term contracts, which makes it even more difficult for them to absorb further labour costs.'
He added: 'In the short term, rising employment costs could really squeeze larger players, as with fewer subcontractors, they have less flexibility to grow their workforce to ensure delivery of projects and manage their cash flow.
'As such, we expect to see a knock-on impact for sub-contractors across the sector, which may unfortunately lead to more distress for some businesses stretched by tight margins and project delays.'
Taxpayers have forked out an extra £8.6bn in just two months as Rachel Reeves' Budget starts to bite, new figures show.
Data from HM Revenue and Customs (HMRC) shows that tax receipts hit £142.8bn for April and May, a rise of more than 6pc compared to the same period last year.
Almost £3 in every additional £4 raised came from income tax and National Insurance, alongside increased revenue from capital gains and inheritance tax.
Tax expert Rachel Griffin called the increase 'another chapter in the Government's stealth tax strategy', while retirement specialist Stephen Lowe said Labour's 'tax train showed absolutely no signs of running out of steam'.
Britain's stock markets shrugged off the ratcheting up of Treasury borrowing and sharp decline in retail sales last month.
The FTSE 100 was up 0.4pc after the White House said Donald Trump will decide within the next two weeks about whether to join Israel in the war.
The mid-cap FTSE 250 gained 0.8pc as market sentiment improved. It is on track for a weekly gain of 0.4pc, although its blue-chip counterpart is on course for a decline of 0.2pc.
Ipek Ozkardeskaya, an analyst at Swissquote Bank, said: 'The investors are taking a little bit more risk on their shoulders... it is perhaps because the US is now giving itself two weeks and maybe some diplomatic opening window there to resolve the situation in Iran.'
Bank were up 1.3pc across the two indexes, while travel and leisure stocks gained 1.3% after Barclays upgraded its rating of Europe's largest travel operator Tui.
Berkeley was the biggest decliner on the FTSE 100, down 7.5pc, after the homebuilder warned of regulatory headwinds as it named current finance chief Richard Stearn as its new boss.
Company insolvencies jumped in May as businesses grappled with Rachel Reeves's tax raid.
There were 2,238 insolvencies in England and Wales last month, a rise of 8pc compared to April and 15pc higher than the same month last year.
Mark Ford, partner at S&W, said there was likely to be a 'steady stream' of companies going under after years of battling luggish economic growth, high borrowing costs, low consumer confidence and high inflation.
He said: 'Higher costs resulting from increases to employer national insurance contributions, the minimum wage and business rates are all heaping considerable pressure on businesses, particularly those that feel they are unable to increase prices for fear of losing customers.'
Companies were hit with a 22pc surge in National Insurance payments last month after Rachel Reeves's tax raid, the OBR said.
The Chancellor hit companies with a £25bn jump in Nics as part of her October Budget, with the changes coming into effect from April.
The OBR said PAYE income tax and Nics cash receipts were £37.2bn in May, which was £3.2bn more than last year, or 9.5pc higher.
However, it was £200m below the Budget watchdog's forecast.
In the first two months of this financial year, PAYE income tax and Nics receipts are £800m above forecast.
Rachel Reeves's tax raid pulled in £300m less than expected during its first two months of operation, the Office for Budget Responsibility (OBR) said.
The Budget watchdog said the 'highly provisional' Treasury borrowing figures indicated that tax revenues remain close to its forecasts.
In its commentary on the latest public sector borrowing figures, the OBR said it expects the Treasury to borrow less in the second half of the financial year, compared to the same period a year earlier.
'This reflects the sharp rise in capital gains tax expected around the end-January due date, lower debt interest payments in the second half of the year, and lower central government net social benefits which were unusually backloaded last year,' it said.
The spike in the price of oil poses another threat to the public finances.
Over the last year, the Chancellor spent 7.3pc of all government revenues just on covering the repayment costs of Britain's £2.7 trillion debt pile.
Brent crude oil is up around 20pc so far in June, and set for its biggest monthly jump since 2020 as the Israel-Iran war deepens.
Much of Britain's national debt is tied to index-linked gilts – bonds which give a return to investors linked to the rate of inflation.
If oil prices spike further and push up the rate of inflation, that will make it even harder for the Chancellor to keep the public finances in order.
The Chancellor will feel a small bit of relief today from the bond markets, where the cost of government borrowing has fallen.
The 10-year UK gilt yield – a benchmark for the cost of servicing the national debt – has edged down to 4.51pc.
Government bonds were steady as Donald Trump indicated he would decide on whether to launch an attack on Israel within the next two weeks.
Retail sales fell at their sharpest pace since December 2023 just as shops began to deal with a surge in staffing costs imposed by the Chancellor.
Sales volumes dropped by 2.7pc in May, hitting retailers a month after Rachel Reeves's hikes in National Insurance contributions and the higher national minimum wage came into force.
Kris Hamer of the British Retail Consortium said: 'May sales saw the weakest growth in 2025 as many consumers hold back on spending on retail, and opt to use their spare cash on experiences and summer holidays.'
He added: 'This weak consumer demand comes at a particularly bad time as retailers are having to grapple with billions of pounds of extra costs this year following the Chancellor's Budget last October.
'The future of business rates reforms is still unclear, but it is vital that it does not result in any shop paying more.
'Otherwise many retailers could be forced to shut down stores, which will impact jobs and local communities, and ultimately the UK's economic growth.'
The FTSE 100 rose at the start of trading despite official figures showing a surge in Treasury borrowing and plunging retails sales.
The UK's blue-chip stock index gained 0.3pc to 8,816.97 after Donald Trump calmed fears of an imminent US involvement in the Middle East conflict.
The President said he would decide in the next two weeks whether the US will enter the Israel-Iran war.
The mid-cap FTSE 250 rose by 0.3pc to 21,134.88.
Thomas Pugh, economist at RSM, said shoppers are being hit by a weaker economy, which bodes ill for retailers.
'The outlook for consumer spending growth is less rosy than it has been in the first half of the year. Inflation is now back at 3.4pc and will rise further over the summer, mainly driven by tax rises, higher utility bills and now more expensive petrol,' he said.
'That will eat into consumers' disposable income. At the same time, the labour market is clearly cooling. This will weigh on wage growth and employment over the rest of the year.'
Treasury borrowing was the second highest ever for the month of May as public spending outweighed tax receipts despite increases in National Insurance contributions imposed on businesses by the Chancellor in her Budget.
ONS deputy director for public sector finances Rob Doody said: 'Last month saw the public sector borrow £700m more than at the same time last year, with only 2020, affected as it was by Covid-19, seeing higher May borrowing in the time since monthly records began.
'While receipts were up, thanks partly to higher income tax revenue and National Insurance contributions, spending was up more, affected by increased running costs and inflation-linked uplifts to many benefits.'
Retail sales dropped by 2.7pc last month as gloomy weather kept shoppers away from the high street, in May in a fresh blow to shopkeepers already struggling with higher taxes.
It represents a sharp fall from strong sales in April, when growth of 1.3pc was boosted by sunny weather and the timing of the Easter holidays.
Every category of sales dropped, according to the Office for National Statistics, with food stores reporting a fall of 5pc, department stores 1.5pc and clothes shops 1.8pc.
Consumers particularly cut back on alcohol and tobacco, the ONS said, while online sales also shrank in a sign households did not simply replace trips to the shops with internet purchases instead.
Compared with May 2024, retail sales were down 1.3pc.
Rachel Reeves's tight spending plans mean tax rises are 'likely' later this year following the overshoot in Treasury borrowing last month, economists have said.
Capital Economics has predicted the Chancellor could need to raise between £13bn and £23bn in her next Budget in the autumn just to maintain her £9.9bn buffer in the public finances.
It warned the OBR may still revise up its borrowing forecasts from March in the Budget after the recent rise in gilt yields on bond markets – a benchmark for the cost of government borrowing.
UK economist Alex Kerr said: 'We doubt it will get much better for the Chancellor anytime soon, as her £9.9bn buffer against her fiscal mandate may be wiped out at the Autumn Budget.
'The U-turns on benefit and welfare spending, downward revisions to the OBR's productivity forecasts and higher borrowing costs may mean to maintain her current £9.9bn buffer, Reeves has to raise £13-23bn later this year.
'And with the gilt market sensitive to significant increases in borrowing, all this means tax rises are looking increasingly likely.'
The Chief Secretary to the Treasury said the latest borrowing figures showed the Government has 'stabilised the economy and the public finances'.
Treasury borrowing was higher than OBR forecasts in May but was better than expected during the first two months of the financial year.
Public sector borrowing was reached £37.7bn in April and May, which was £1.6bn more than the same period last year but £2.9bn less than the £40.7bn forecast by the OBR.
Darren Jones said: 'Since taking office, we have taken the right decisions to protect working people, begin repairing the NHS, and fix the foundations to rebuild Britain. We stabilised the economy and the public finances; now we need to ensure that the British economy delivers for working people.
'Last week's Spending Review showed how we are investing in the UK's security, health, and the economy through our Plan for Change, so that people are better off.'
The Government's tax receipts hit £82.5bn in May, which was £5.3bn more than in the same month last year.
Income tax receipts increased by £1.9bn, with VAT up by £800m and corporation tax receipts higher by £600m.
So-called compulsory social contributions, largely made of National Insurance contributions (Nics), increased by £3.9bn to £30.2bn.
Rachel Reeves's changes to Nics announced in her October Budget came into force on April 6.
The Treasury borrowed more than expected during the month of May, official figures show, despite increasing receipts from Rachel Reeves's tax raid.
Public sector net borrowing was £600m higher last month than the £17.1bn that had been forecast by the Office for Budget Responsibility.
It was also £700m higher than May last year.
Thanks for joining me. Rachel Reeves will shortly find out how much the Treasury has borrowed during the first two months of the year. Here is what you need to know:
Britain's biggest bank to cut UK investments in snub to Reeves | Lloyds' pension arm will shift investments to better-performing markets
'Henrys' ditch Starmer as Labour taxes them to oblivion | Aspirational young voters feel hoodwinked by the PM's promise of 'wealth creation'
Crown Estate to build hundreds of giant wind farms off Cornish coast | Offshore turbines likely to be visible from popular holiday resorts in South West and Wales
Carney threatens to raise tariffs on US if Trump talks fail | Canadian PM prepares for month-long series of negotiations with the president
Ambrose Evans-Pritchard: We are witnessing the death of American democracy | There are parallels but also differences between Trump's America and Germany in the early 1930s
Crude oil prices rose and Asian shares were trading mixed as investors awaited more clarity on whether or not the US will join Israel's war against Iran.
Wall Street was closed on Thursday for the Juneteenth holiday but U.S. benchmark crude oil added 15 cents to $73.65 per barrel.
Brent crude, the international standard, was up 19 cents at $76.89 per barrel amid fears that the conflict between Israel and Iran could disrupt the global flow of oil.
Investors remained wary after the White House said President Donald Trump could decide on whether to launch an attack on Israel within the next two weeks.
Tokyo's Nikkei 225 index edged 0.1pc higher to 38,538.14 after Japan reported that its core inflation rate, excluding volatile food prices, rose to 3.7pc in May, adding to challenges for Prime Minister Shigeru Ishiba's government and the central bank.
Hong Kong's Hang Seng index jumped 1.2pc to 23,504.59, while the Shanghai Composite gained 0.1pc, reversing earlier losses, to 3,364.83. China's central bank kept its key one-year and five-year loan prime rates unchanged, as expected.
Australia's S&P/ASX 200 shed 0.3pc to 8,500.40 while South Korea's Kospi gained 1.2pc to 3,014.05.
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When I started my business career in the early 1990s, HR was responsible for recruiting, benefits and payroll — that was it. As I moved up the ladder and found myself in executive meetings, the HR leader weighed in last on key business decisions, if at all. Advertisement Thirty years on, HR leaders are calling themselves 'Chief Human Resources Officers,' and they proclaim their power with reckless and off-topic abandon. HR departments today are packed with Tracy Flicks, the way-too-eager high schooler played by Reese Witherspoon in the movie 'Election.' Flick is the archetypal 'Head Girl,' a term derived from the British school system and its tight hierarchy of internal discipline — ambitious and officious with little actual skill or intellect. Hand-raisers like these are not selected to lead for intelligence or ability, but for conscientiousness and a willingness to uphold 'the rules.' Advertisement That was fine when HR had no power. But now, after yearning for a seat at the table, HR's midwit elites have found a way to exert increasing influence in the corporate environment — leveraging social-justice buzzwords to accrue power and (what else?) make more rules. In the 2020s, HR asserts its newly found clout with tyrannical zeal. When I interviewed in 2023 for a CEO job at an $8 billion retailer, I made it all the way to the end of the corporate leadership receiving line, successfully fielding queries on my business acumen and brand-building accomplishments. My last interview was with the HR representative on the board. Her first question: 'Will you apologize for what you've done?' Get opinions and commentary from our columnists Subscribe to our daily Post Opinion newsletter! Thanks for signing up! Enter your email address Please provide a valid email address. By clicking above you agree to the Terms of Use and Privacy Policy. Never miss a story. Check out more newsletters What I'd 'done' was advocate for opening public schools during the COVID pandemic. By 2023 I'd been proven right. That didn't matter to the HR lady. I'd violated her tightly enforced script. Advertisement I didn't apologize, and I didn't get the job. Over the last two decades, HR has gone from operational support to Operation Head Girl Hall Monitor. They force-feed trainings about acceptable language; they make 'merit' out to be racist; and they set hiring criteria based on risk avoidance rather than excellence. But hiring people who don't offend anyone won't result in employees who take initiative and make things. Advertisement Am I being sexist in calling them Head Girls? In 2023, 76% of HR managers in the United States were female. The shoe fits. (And yes, men can be Head Girl types, too.) British academic Bruce Charlton explains the Head Girl 'can never be a creative genius because she does what other people want by the standard they most value.' That's why the Head Girls of HR made everyone add pronouns to their email signatures starting around 2020: Social standards. Not because it drove the business. Advertisement No, these time-suckers shift focus away from the business. Front-of-house employees — builders, makers and service providers — must spend a significant amount of time thinking about the words they use rather than their actual jobs. Critics of my viral comment pushed back at me: 'You need HR to avoid unnecessary risk!' they chorused. Right. That's the fear HR leverages to maintain its unearned influence. Advertisement Risk avoidance means hiring mediocre people with no opinions who never offend anyone. Those hires won't take my one-year-old start-up to big-brand status. I want big thinkers with creative minds. Sometimes these folks are disruptive. But there are no new products or breakthrough marketing campaigns without them. My company is a walking, talking HR violation. We 'misgender' all day long. In fact, speaking truth (as I call it) is required to work here. We're not in school anymore. We don't need a persnickety Miss Manners etiquette-enforcer telling us to be nice. I'll continue to go it alone without HR. I'll assume the so-called risk so I can lead in my own voice. And I'll succeed, or fail, on my own terms. Jennifer Sey is founder and CEO of XX-XY Athletics.

Los Angeles Times

2 hours ago

• Los Angeles Times

U.S. stocks drift to a mixed finish as Wall Street closes another week of modest losses

U.S. stocks drifted to a mixed finish on Friday in a quiet return to trading following the Juneteenth holiday. The S&P 500 fell 0.2% to close out a second straight week of modest losses. The Dow Jones Industrial Average added 35 points, or 0.1%, and the Nasdaq composite fell 0.5%. Treasury yields also held relatively steady in the bond market after President Donald Trump said he will decide within two weeks whether the U.S. military will get directly involved in Israel's fighting with Iran. The window offers the possibility of a negotiated settlement over Iran's nuclear program that could avoid increased fighting. The conflict has sent oil prices yo-yoing over the last week, which has in turn caused see-saw moves for the U.S. stock market, because of rising and ebbing fears that the war could disrupt the global flow of crude. Iran is a major producer of oil and also sits on the narrow Strait of Hormuz, through which much of the world's crude passes. 'We're all waiting on pins and needles to see what happens with the Israel-Iran situation,' said Brian Jacobsen, chief economist at Annex Wealth Management. 'These types of situations can stress markets, but often the best way to manage that stress is to just ride through it and not try to trade it.' On Wall Street, Kroger rose 9.8% after the grocer reported a better profit for the latest quarter than Wall Street had forecast. It also raised its forecast for an underlying measure of revenue for the full year. But while Chief Financial Officer David Kennerley said it's seeing positive momentum, the company is also still seeing an uncertain overall economic environment. CarMax climbed 6.6% after the auto dealer reported a stronger profit for the latest quarter than analysts expected. The company said it sold nearly 6% more used autos during the quarter than it did a year earlier. On the losing end of Wall Street was Smith & Wesson Brands, the maker of guns. It tumbled 19.8% after reporting profit and revenue for the latest quarter that fell just shy of analysts' expectations. Chief Financial Officer Deana McPherson said 'persistent inflation, high interest rates, and uncertainty caused by tariff concerns' have been hurting sales for firearms, and the company expects demand in its upcoming fiscal year to be similar to this past year's, depending on how inflation and tariffs play out. All told, the S&P 500 fell 13.03 points to 5,967.84. The Dow Jones Industrial Average rose 35.16 to 42,206.82, and the Nasdaq composite fell 98.86 to 19,447.41. A spate of companies has been adjusting or even withdrawing their financial forecasts for 2025 because of all the uncertainty that tariffs are creating for customers and for suppliers. Everyone is waiting to see whether Trump will reach trade deals with other countries that could lower his tariffs on imports, many of which are currently on pause. It's not just corporate America that's waiting. The Federal Reserve has been keeping its main interest rate on hold this year, with its latest such decision coming earlier this week, because it wants to see more data about how much tariffs will grind down on the economy and push up inflation. In the bond market, Treasury yields held relatively stable. The yield on the 10-year Treasury edged down to 4.37% from 4.38% late Wednesday. The two-year yield, which more closely tracks expectations for what the Fed will do, fell to 3.90% from 3.94%. In stock markets abroad, indexes were mixed across Europe and Asia. Tokyo's Nikkei 225 index slipped 0.2% after Japan reported that its core inflation rate, excluding volatile food prices, rose to 3.7% in May, adding to challenges for Prime Minister Shigeru Ishiba's government and the central bank. Choe and Cerojano write for Associated Press.