UK firms should brace for extra employment costs

Small firms across the UK could be hit with £2,600 in additional employment costs, according to analysis from the Federation of Small Businesses.

The warning comes as a study suggests that businesses will face the extra costs resulting from government policies in the 2017-2018 tax year.

The FSB has therefore called on Chancellor Philip Hammond to address the problem in this year’s budget in order to boost job creation and productivity.

Employment costs have risen steadily in the past few years – pension auto-enrolment and the higher national living wage pushing up national insurance contributions are both factors behind this.

At the same time, the FSB has also identified the need to ensure that progression is made across the regions of the UK, and not just in the south or north.

The lobby group’s national chairman Mike Cherry has described the budget as an opportunity for the Government to “how it is unashamedly pro-business” and aid job growth.

There are millions of small businesses in the UK and they have a key role to play in supporting job creation.

However, the latest figures suggest that higher operational costs are limiting their growth potential and impacting on sales and the bottom line for some firms.

For those that are unable to overcome their financial difficulties or clear debts, they may be forced to enter administration or face a winding up petition.

Entering administration can provide some much needed breathing space to get a business back on track, although there are a wide range of opportunities and solutions can exist for business owners that act in an assured and considered manner.

Those that have fears over the longevity of their businesses should seek assistance and advice from a corporate insolvency specialist to find the options that are best for them and their business.

The FSB is also keen for the Government to make the process of creating a company easier, in order to encourage more individuals to consider self-employment and alternative opportunities.

By Phil Smith

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