Budget measures risk undermining fragile recruitment market, warns APSCo

The Chancellor’s Budget has failed to deliver the stability and confidence that UK businesses urgently need, with measures that risk increasing costs and regulatory burdens for employers. That’s according to the Association of Professional Staffing Companies (APSCo UK).

Samantha Hurley, Managing Director at APSCo UK commented:

“The one thing the UK economy needed from this Budget was stability and confidence-boosting measures. Unfortunately, before the Chancellor even spoke, markets were unsettled by leaks and speculation. While there are some positive elements, such as an extension of enterprise incentives and other tax support to “scale up businesses” these have been overshadowed by the chaotic lead-up and the disappointing detail of today’s announcements.

“Recruitment and workforce solution firms - already under strain from flat economic conditions, cost-of-living pressures, and the looming Employment Rights Bill implementation - now face rising costs and added complexity. Despite words of support towards entrepreneurs taking risk and businesses choosing to invest and grow in the UK, very little was offered to boost business.

“Employer liabilities will increase with higher National Living Wage rates, tightened salary sacrifice rules for pension contributions that slash NIC exemptions from £60K to £2K, meaning increased NICs and rising business rates. At the same time, sweeping reforms in the Employment Rights Bill risk creating barriers to hiring and undermining the Government’s own ambition to reduce business administration by 25% by 2029.

“We are seeing fragile growth. Our latest Hiring Trends – produced in conjunction with Bullhorn – shows a steady rise in contract hiring in the last two months. We need to see more support to boost this trend, but doing so requires appropriate change that is supported by businesses.

“As we have said before, the Employment Rights Bill introduces sweeping reforms, including guaranteed hours for temporary staff and day one rights against dismissal, that go far beyond what is necessary to protect workers. Reform is needed, but it must be nuanced and necessary. Different workers require different safeguards, and businesses need freedom to access talent. The current approach risks shrinking the labour market and stifling job creation.
“We urge the Government to work with industry to strike the right balance, protecting workers while enabling flexibility and growth. That necessitates a focus on a pro-workforce agenda, improved trade conditions with Europe, and policies that boost jobs rather than add cost and complexity that are critical to the UK’s economic resilience.”


Press contact
Vickie Collinge
vickie@bluesky-pr.com
01582 790 705
About APSCo
The Association of Professional Staffing Companies (APSCo) is the trade association for the professional recruitment market. APSCo Global comprises APSCo South East Asia, APSCo Australia, APSCo Deutschland and APSCo United Kingdom as well as APSCo OutSource, the trade body for the RPO and MSP sectors.
Find out more: www.apscouk.org