How the Autumn Statement could affect the job market
Posted on 1st December 2023
Cost of living
The government accepted the Low Pay Commission’s recommendations on record increases to minimum wage rates. The National Living Wage (NLW) which applies to employees over 21 from April 2024 goes up by over £1 to £11.44 per hour.
At the same time, Universal Credit and some other benefits increase by 6.7%, in line with September’s inflation rate. However new rules planned for 2025 will encourage claimants to gain work experience and find permanent work within 18 months.
Combined, these measures could make variable hours temporary employment a more attractive financial option for jobseekers.
Benefits of temporary employment
Temporary employment allows people to gain experience, change direction, return to work and show their value as employees. There are often good opportunities to update workplace skills with on-the-job training. Demonstrating day to day skills in a temporary role can often lead to permanent job offers.
In addition, temporary employees can also build up paid holidays and qualify for staff pension schemes after three months. Those over 22 and under state pension age earning more than £192 per week can currently join their employer’s scheme. The Chancellor unveiled plans to provide similar contributions to a personal pension ‘pot for life’. These benefits could make temporary work an even more attractive way to start a career or take a new direction.
Career first steps
The minimum wages for younger employees also go up from next April. The minimum pay for apprentices and 16 to 17 year-olds will increase by over 20% to £6.40 per hour. For 18 to 20 year olds the new rate of £8.60 per hour is a rise of almost 15%. £50million is also available over the next two years to increase engineering apprenticeships.
These increases add costs for employers. However, they could create a larger pool of young people looking to gain skills by training through full-time, part-time or temporary work. Employers can benefit by actively recruiting new young talent and making a commitment to on-the-job training.
The retirement picture
Older employees will be happy to hear the State Pension triple lock is retained. The 8.5% increase from April 2024 could mean older employees approaching retirement reconsider their plans. Employers will need to check whether employees approaching State Pension age want to fully retire or continue working in part-time or temporary roles.
With recent price increases and many families relying on older generations to help them financially the picture isn’t clear. Without flexible options to keep the knowledge and skill of older employees in the workplace, employers could find themselves facing significant extra challenges.
Retail, hospitality and leisure
The small business multiplier is frozen for another year. Centrally funded business rates reductions of 75% will also help thousands of retail, hospitality and leisure businesses.
While these measures give many small businesses a boost it could also increase recruitment competition. A clear recruitment strategy for temporary workers could attract people looking for flexibility to help fill your vacancies.
Please get in touch to discuss recruitment options to help you take full advantage of measures in the Autumn Statement.
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