Chancellor Reeves’s tenure has been marked by a mix of economic challenges, political controversy, and cautious fiscal management, eliciting a wide range of reactions from different sectors of the UK economy. While public opinion has largely turned against her—with polls consistently ranking her as one of the most unpopular chancellors on record—financial markets and the City of London have shown a measure of pragmatism in their assessments.

Reeves’s time in office has seen rising unemployment and a wave of business closures, outcomes many attribute to her tax policies. A key factor was the £25 billion increase in national insurance contributions, coupled with a steeper minimum wage, which critics argue placed disproportionate pressure on employers—especially small businesses—and dampened job creation. The restructured thresholds made entry-level hiring significantly more expensive, exacerbating difficulties for pubs, shops, and restaurants. This, along with other government initiatives such as the workers’ rights bill, has contributed to an estimated one million young people classified as not in education, employment, or training (NEET), highlighting a particularly troubling aspect of her economic legacy.

Business leaders across the board expressed frustration with what they saw as a hostile tax environment during Reeves’s stewardship. Yet despite this tension, her relationship with the City remained notably cooperative. An arrangement—described by some insiders as a “Faustian pact”—saw Reeves protect financial institutions from additional windfall taxes and heavy reforms in exchange for support or at least muted criticism from banking executives. This fragile alliance helped bolster her image of economic credibility, even as broader segments of the business community felt neglected.

Reeves has taken steps to recalibrate the UK’s fiscal framework, notably redefining the national debt in terms of “net public sector liabilities” to create additional borrowing capacity, amounting to roughly £50 billion. Her government also authorized £120 billion in borrowing for investment purposes, aiming to address longstanding infrastructure underinvestment that has kept the economy lagging in international comparisons. While the Office for Budget Responsibility has cautioned that this level of borrowing may increase short-term interest rates and take time to yield growth dividends, many acknowledge that the investment push fills a critical gap.

Economic growth under Reeves has been modest but not stagnant. The UK’s GDP growth, forecast at about 1 percent for the year, ranks it as the strongest performer within the G7 amid a challenging global context, including geopolitical instability. Reeves’s fiscal discipline, including refusal to relax borrowing constraints despite pressure from within her party, reinforced her reputation for steady stewardship in the eyes of markets.

Nevertheless, Reeves’s policies have been criticized for lacking boldness and for failing to adequately address structural labor market issues, especially youth employment. Her decision to avoid taxing wealthy individuals more heavily may have preserved capital flows but at the potential cost of increased burdens on employers and vulnerable workers.

As her successor prepares to take office, the legacy Reeves leaves behind is one of cautious economic management amid adversity. The City’s relative approval contrasts with widespread popular dissatisfaction, underscoring the complex trade-offs inherent in navigating fiscal responsibility alongside societal expectations.