Caithness group’s fears over staff recruitment after budget double blow for businesses
Recruitment could stall across the north Highlands, it is feared, after the Budget dealt a double whammy to businesses in the far north.
Trudy Morris, chief executive of the Caithness Chamber of Commerce, said the increase in employer National Insurance contributions came as no surprise – but the threshold change was an unexpected blow.
“The reduction in the secondary threshold at which businesses have to pay is a double tax hit,” she said.
“While there was some protection for smaller firms, the increase coupled with the 6.7 per cent increase in the National Living Wage, means it will be extremely challenging to invest and recruit.
“With the increase in NICs accounting for half of the £40 billion fiscal funding gap, businesses are having to bear the lion’s share of it and the fear is that those who will be unable to absorb these costs will have no alternative but to pass them onto consumers.
“The knock-on effect of this could result in recruitment stalling as staffing remains the most significant cost pressure for the business community.”
Ms Morris called on the Scottish Government to use some of the £3.4 billion additional funding for the country to support businesses.
She said: “These increases will pose challenges, particularly for the hospitality and service industries, where raising prices to address the tax changes isn’t always feasible as there is a limit on what consumers are willing to pay.
“There was some good news amongst the bad for the north Highlands. The freeze in fuel duty is welcome in a region where public transport is a challenge or simply non-existent.
“All eyes will now be on the Scottish Government budget, and we urge them to utilise consequential funding to support the business community, to ensure a level playing field with the rest of the UK, such as in non-domestic rates and planning.”
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