Preparing for Significant Financial Changes
As we step into March and embrace the start of Spring, businesses are also preparing for significant financial changes coming into effect in April. With both the increase in Employer National Insurance contributions and a rise in the National Living Wage, employment costs are set to rise.
With businesses already managing economic uncertainty, skills shortages, and rising operational costs, these changes bring new challenges—but they also provide opportunities to rethink recruitment and retention strategies.
What’s Changing in April?
Employer National Insurance Increase – From April, Employer NI contributions will rise, meaning higher payroll costs for businesses across all sectors. This is especially concerning for SMEs, who may find it harder to absorb these additional costs compared to larger corporations.
National Living Wage Increase – The National Living Wage (for workers aged 21 and over) will rise to £12.21 per hour. This represents a significant increase, particularly for sectors that rely on lower-wage workers, such as retail, hospitality, and care.
Many businesses will need to review salary structures, especially to maintain pay differentials for more experienced staff.
The Bigger Picture: What Does This Mean for Businesses?
For many SMEs, these cost increases mean that every hiring decision needs to be even more strategic. Simply adding headcount may not be financially viable, so businesses need to focus on maximising the value of their workforce.
How Businesses Are Adapting
Instead of halting hiring plans, companies are adjusting their approach:
- Workforce Planning – Businesses are reviewing whether they have the right skills in-house before hiring externally.
- Strategic Recruitment – Companies are focusing on high-value roles, ensuring each hire has a clear impact on business growth.
- Skills Over Job Titles – Employers are looking for adaptable, multi-skilled candidates who can take on a broader range of responsibilities.
- Retention Over Recruitment – More businesses are investing in employee engagement and career development to reduce costly turnover.
What Can Employers Do Now?
- Assess the Financial Impact – Review payroll costs and budgets for the Employer NI increase and National Living Wage rise. Consider adjusting salary bands to avoid pay compression issues between junior and senior staff.
- Focus on Retention & Productivity – Investing in staff development, wellbeing, and engagement will help businesses keep valuable employees without unnecessary turnover costs.
- Streamlining processes and improving efficiency can help offset higher employment costs.
- Hire Smarter, Not Harder – Ensure every new hire brings tangible value to the business. Consider temporary or part-time hires as a cost-effective solution for fluctuating workloads.
How We Can Help
At Debbie Burbage Recruitment, we help businesses navigate these challenges, ensuring they hire the right people at the right time while also helping them retain their best talent.
If you’re rethinking your workforce strategy ahead of April’s changes, let’s talk. Whether it’s streamlining your recruitment process, reassessing job roles, or finding highly skilled candidates who can add real value to your business, we’re here to help.
- How is your business preparing for these changes? We’d love to hear your thoughts!
Preparing for Significant Financial Changes
As we step into March and embrace the start of Spring, businesses are also preparing for significant financial changes coming into effect in April. With both the increase in Employer National Insurance contributions and a rise in the National Living Wage, employment costs are set to rise.
With businesses already managing economic uncertainty, skills shortages, and rising operational costs, these changes bring new challenges—but they also provide opportunities to rethink recruitment and retention strategies.
What’s Changing in April?
Employer National Insurance Increase – From April, Employer NI contributions will rise, meaning higher payroll costs for businesses across all sectors. This is especially concerning for SMEs, who may find it harder to absorb these additional costs compared to larger corporations.
National Living Wage Increase – The National Living Wage (for workers aged 21 and over) will rise to £12.21 per hour. This represents a significant increase, particularly for sectors that rely on lower-wage workers, such as retail, hospitality, and care.
Many businesses will need to review salary structures, especially to maintain pay differentials for more experienced staff.
The Bigger Picture: What Does This Mean for Businesses?
For many SMEs, these cost increases mean that every hiring decision needs to be even more strategic. Simply adding headcount may not be financially viable, so businesses need to focus on maximising the value of their workforce.
How Businesses Are Adapting
Instead of halting hiring plans, companies are adjusting their approach:
- Workforce Planning – Businesses are reviewing whether they have the right skills in-house before hiring externally.
- Strategic Recruitment – Companies are focusing on high-value roles, ensuring each hire has a clear impact on business growth.
- Skills Over Job Titles – Employers are looking for adaptable, multi-skilled candidates who can take on a broader range of responsibilities.
- Retention Over Recruitment – More businesses are investing in employee engagement and career development to reduce costly turnover.
What Can Employers Do Now?
- Assess the Financial Impact – Review payroll costs and budgets for the Employer NI increase and National Living Wage rise. Consider adjusting salary bands to avoid pay compression issues between junior and senior staff.
- Focus on Retention & Productivity – Investing in staff development, wellbeing, and engagement will help businesses keep valuable employees without unnecessary turnover costs.
- Streamlining processes and improving efficiency can help offset higher employment costs.
- Hire Smarter, Not Harder – Ensure every new hire brings tangible value to the business. Consider temporary or part-time hires as a cost-effective solution for fluctuating workloads.
How We Can Help
At Debbie Burbage Recruitment, we help businesses navigate these challenges, ensuring they hire the right people at the right time while also helping them retain their best talent.
If you’re rethinking your workforce strategy ahead of April’s changes, let’s talk. Whether it’s streamlining your recruitment process, reassessing job roles, or finding highly skilled candidates who can add real value to your business, we’re here to help.
- How is your business preparing for these changes? We’d love to hear your thoughts!