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- Increased National Insurance costs destroying your profits and stunting your growth? It doesn’t have to be that way…
- Economic uncertainty and rising employment costs put the brakes on hiring across the UK economy with a record low number of businesses planning to recruit new staff according to several surveys published in the last couple of months.
- The Chartered Institute of Personnel and Development (CIPD) have reported only 57% of firms plan to hire staff in the next quarter – down 10% from last Autumn whilst KPMG/Recruitment and Employment Confederation (REC) found a dearth of job postings for both permanent and temporary roles in July.
- Businesses claim that since Rachel in accounts decided it was a good idea for the Government to hit business with a £25bn increase in Employers’ National Insurance contributions (ERNIC) the brakes have been applied to business investment – specifically in terms of people where costs have increased markedly.
- With Employer’s National Insurance rising to 15% and the small business NI allowance shrinking from £9,000 to £5,000, the cost of employing staff is increasing sharply. The annual cost of employing someone on a £25,000 annual salary is now over a £1,000/annum more due to the ERNIC increases before even considering wage inflation.
- Of course, cutting back headcount and failing to replace roles that become vacant is a major obstacle to driving a business forward, and it is highly likely any short-term “gains” will be at the cost of longer-term growth,
- There are however other options.
- At ERA Group, both directly and in conjunction with trusted partners, we provide our clients with multiple strategies to at least offset 100% of the increase in ERNIC costs – and in many cases can facilitate client’s saving up to 50% of their total ERNIC liability.
- Some of these strategies utilise Employee Benefits and restructuring which has the further benefit of attracting and retaining talent whilst simplifying payroll, HR and compliance processes.
- For example, a business with as few as 100 employees and a monthly payroll of £200k can expect to save more than £150k/annum whilst delivering a suite of Employee Benefits to staff.Want to cut costs and fund growth?Email Paul Gravatt (pgravatt@eragroup.com) or speak to your ERA contact to set up a no-obligation meeting.
- Contact Paul Gravatt
