UK Companies Postpone Hiring Ahead of Budget as Costs Rise
Current overview (not historical)
British firms are delaying new hires in anticipation of the upcoming Budget, citing rising employment costs. Many have called for cuts to National Insurance contributions and VAT to ease the burden. In response, the government has pledged to lower employer National Insurance rates for apprentices under 25 and for new employees under 21, while also promising broader corporate tax cuts to help companies. The decision to hold back on hiring reflects concerns that higher costs could erode profitability and competitiveness. While the government’s targeted relief measures aim to mitigate these pressures, the broader impact on job creation remains uncertain as firms weigh the timing of new hires against projected fiscal changes.
Written with AI from the reporting · updated 10/25/2026
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- 1Unclassified fact stationOct 25, 15:23single sourcereport-time onlyrevised
Firms 'holding back' on new jobs ahead of Budget
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- Oct 25, 15:06
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- Oct 25, 15:23
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- BBC BusinessRelated fact: single sourceFact occurrence time unverifiedSource report revisedUK firms postpone hiring as National Insurance and VAT costs rise ahead of the Budget
Report first recorded Oct 25, 15:23
Business owners across Plymouth and Devon say they are holding back on new hires because the 2024 Budget will raise employer National Insurance contributions to 15% on salaries above £5,000 (up from 13.8% on salaries above £9,100) and increase the legal minimum wage for over‑21s to £12.21 per hour. Small‑business owners like Michelle Bunker of WGP Maintenance and Tim Randell of Links Publishing argue that the higher payroll costs, combined with a living‑wage increase, make it difficult to expand. The hospitality sector, represented by the Moxy Hotel and the Duke of Cornwall Hotel, also calls for a reduction in the 20% VAT on pubs and restaurants to 10% to ease financial pressure. The government has pledged to ease the burden through lower corporate tax rates and reduced National Insurance for apprentices and employees under 21, but many firms still feel the impact of the cost‑of‑living crisis on both business growth and charitable fundraising.
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