Two thirds of CFOs have said their business will be forced to raise prices as a result of higher wage bills, according to a new survey.

Around 70 per cent of respondents to the survey, which looked at the attitudes of CFOs at 52 retailers, were “pessimistic” or “very pessimistic” about trading conditions over the coming 12 months, according to the British Retail Consortium (BRC).

BRC chief executive, Helen Dickinson, said that changes to national insurance contributions have a “disproportionate impact” on retailers and their supply chains, who together employ 5.7m people across the country.

Employer’s national insurance contributions (NICs) – a tax on employees’ wages – will rise 1.2 per cent to 15 per cent as of April 6, following Rachel Reeves October Budget. However, many retailers are struggling more with the second change: the lower threshold for the tax.

Employers will have to start paying NICs on wages over £5,000. The threshold was previously £9,100. Given that half of all retail employees work part-time, this will bring around 1.45m employees directly employed in retail into the bracket.

“With slow market growth and margins already stretched thin, it is inevitable that consumers will bear some of the burden,” Dickinson added.

While inflation has dropped throughout 2024, this has been driven by increased discounting as shops compete for price-conscious shoppers – particularly in the Autumn – which has cut into retailer’s margins and made them particularly vulnerable to higher taxes.

JD Sports noted this in its festive trading results this morning, with a “more promotional environment in the period than we anticipated”.