{"id":10320,"date":"2025-01-03T10:26:54","date_gmt":"2025-01-03T10:26:54","guid":{"rendered":"https:\/\/www.brightmine.com\/uk\/?post_type=resources&#038;p=10320"},"modified":"2025-10-29T15:39:49","modified_gmt":"2025-10-29T15:39:49","slug":"cost-of-employing-low-wage-staff-to-hit-record-high","status":"publish","type":"resources","link":"https:\/\/www.brightmine.com\/uk\/resources\/hr-strategy\/workforce-planning\/cost-of-employing-low-wage-staff-to-hit-record-high\/","title":{"rendered":"Cost of employing low-wage staff to hit record high"},"content":{"rendered":"\n<div class=\"wp-block-cover alignfull\" style=\"margin-top:0;margin-bottom:0;padding-top:15px;padding-right:var(--wp--preset--spacing--30);padding-bottom:15px;padding-left:var(--wp--preset--spacing--30);min-height:250px;aspect-ratio:unset;\"><span aria-hidden=\"true\" class=\"wp-block-cover__background has-background-dim-0 has-background-dim\"><\/span><img loading=\"lazy\" decoding=\"async\" width=\"1920\" height=\"1080\" class=\"wp-block-cover__image-background wp-image-5877\" alt=\"Brightmine background\" src=\"https:\/\/cdn.brightmine.com\/wp-content\/uploads\/sites\/2\/2024\/04\/19110611\/Hero_Header_HP_Background_Desktop.webp\" style=\"object-position:100% 51%\" data-object-fit=\"cover\" data-object-position=\"100% 51%\" srcset=\"https:\/\/cdn.brightmine.com\/wp-content\/uploads\/sites\/2\/2024\/04\/19110611\/Hero_Header_HP_Background_Desktop.webp 1920w, https:\/\/cdn.brightmine.com\/wp-content\/uploads\/sites\/2\/2024\/04\/19110611\/Hero_Header_HP_Background_Desktop-300x169.webp 300w, https:\/\/cdn.brightmine.com\/wp-content\/uploads\/sites\/2\/2024\/04\/19110611\/Hero_Header_HP_Background_Desktop-1024x576.webp 1024w, https:\/\/cdn.brightmine.com\/wp-content\/uploads\/sites\/2\/2024\/04\/19110611\/Hero_Header_HP_Background_Desktop-768x432.webp 768w, https:\/\/cdn.brightmine.com\/wp-content\/uploads\/sites\/2\/2024\/04\/19110611\/Hero_Header_HP_Background_Desktop-1536x864.webp 1536w\" sizes=\"auto, (max-width: 1920px) 100vw, 1920px\" \/><div class=\"wp-block-cover__inner-container has-global-padding is-layout-constrained wp-container-core-cover-is-layout-9ca95970 wp-block-cover-is-layout-constrained\">\n<div class=\"wp-block-columns is-layout-flex wp-container-core-columns-is-layout-fca5db16 wp-block-columns-is-layout-flex\" style=\"padding-top:15px;padding-right:0;padding-bottom:15px;padding-left:0\">\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\" style=\"flex-basis:50%\">\n<div class=\"wp-block-group has-cararra-gray-background-color has-background has-global-padding is-layout-constrained wp-container-core-group-is-layout-f90d3be4 wp-block-group-is-layout-constrained\" style=\"border-bottom-left-radius:25px;border-bottom-right-radius:25px;padding-top:var(--wp--preset--spacing--40);padding-right:var(--wp--preset--spacing--30);padding-bottom:var(--wp--preset--spacing--40);padding-left:var(--wp--preset--spacing--30);box-shadow:var(--wp--preset--shadow--natural)\">\n<h1 class=\"wp-block-heading has-primary-purple-color has-text-color has-link-color wp-elements-29873a1bfaa4b1ed370c9b0890d4cdc4\">Cost of employing low-wage staff to hit record high<\/h1>\n\n\n\n<p class=\"has-primary-gray-color has-text-color has-link-color has-medium-font-size wp-elements-614a635df756119b1b80bca3a80d9cd9\">The cost of employing low-wage workers will hit a record high in 2025, according to an analysis by the Centre for Policy Studies.<\/p>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\" style=\"flex-basis:50%\">\n<figure class=\"wp-block-image aligncenter size-full has-custom-border\"><img loading=\"lazy\" decoding=\"async\" width=\"800\" height=\"645\" src=\"https:\/\/cdn.brightmine.com\/wp-content\/uploads\/sites\/2\/2024\/04\/11141301\/resource_page_banner_brightmine.webp\" alt=\"Brightmine resources graphic\" class=\"wp-image-4642\" style=\"border-radius:0px\" srcset=\"https:\/\/cdn.brightmine.com\/wp-content\/uploads\/sites\/2\/2024\/04\/11141301\/resource_page_banner_brightmine.webp 800w, https:\/\/cdn.brightmine.com\/wp-content\/uploads\/sites\/2\/2024\/04\/11141301\/resource_page_banner_brightmine-300x242.webp 300w, https:\/\/cdn.brightmine.com\/wp-content\/uploads\/sites\/2\/2024\/04\/11141301\/resource_page_banner_brightmine-768x619.webp 768w\" sizes=\"auto, (max-width: 800px) 100vw, 800px\" \/><\/figure>\n<\/div>\n<\/div>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-group alignfull has-primary-white-background-color has-background has-global-padding is-layout-constrained wp-container-core-group-is-layout-0fd240ca wp-block-group-is-layout-constrained\" style=\"margin-top:0;margin-bottom:0;padding-top:var(--wp--preset--spacing--40);padding-right:var(--wp--preset--spacing--30);padding-bottom:var(--wp--preset--spacing--40);padding-left:var(--wp--preset--spacing--30)\">\n<div class=\"wp-block-group is-content-justification-right is-nowrap is-layout-flex wp-container-core-group-is-layout-17124a9a wp-block-group-is-layout-flex\">\n<p class=\"\">Share this:<\/p>\n\n\n<div class=\"addtoany_shortcode\"><div class=\"a2a_kit a2a_kit_size_28 addtoany_list\" data-a2a-url=\"https:\/\/www.brightmine.com\/uk\/resources\/hr-strategy\/workforce-planning\/cost-of-employing-low-wage-staff-to-hit-record-high\/\" data-a2a-title=\"Cost of employing low-wage staff to hit record high\"><a class=\"a2a_button_linkedin\" href=\"https:\/\/www.addtoany.com\/add_to\/linkedin?linkurl=https%3A%2F%2Fwww.brightmine.com%2Fuk%2Fresources%2Fhr-strategy%2Fworkforce-planning%2Fcost-of-employing-low-wage-staff-to-hit-record-high%2F&amp;linkname=Cost%20of%20employing%20low-wage%20staff%20to%20hit%20record%20high\" title=\"LinkedIn\" rel=\"nofollow noopener\" target=\"_blank\"><\/a><a class=\"a2a_button_x\" href=\"https:\/\/www.addtoany.com\/add_to\/x?linkurl=https%3A%2F%2Fwww.brightmine.com%2Fuk%2Fresources%2Fhr-strategy%2Fworkforce-planning%2Fcost-of-employing-low-wage-staff-to-hit-record-high%2F&amp;linkname=Cost%20of%20employing%20low-wage%20staff%20to%20hit%20record%20high\" title=\"X\" rel=\"nofollow noopener\" target=\"_blank\"><\/a><a class=\"a2a_button_facebook\" href=\"https:\/\/www.addtoany.com\/add_to\/facebook?linkurl=https%3A%2F%2Fwww.brightmine.com%2Fuk%2Fresources%2Fhr-strategy%2Fworkforce-planning%2Fcost-of-employing-low-wage-staff-to-hit-record-high%2F&amp;linkname=Cost%20of%20employing%20low-wage%20staff%20to%20hit%20record%20high\" title=\"Facebook\" rel=\"nofollow noopener\" target=\"_blank\"><\/a><a class=\"a2a_button_email\" href=\"https:\/\/www.addtoany.com\/add_to\/email?linkurl=https%3A%2F%2Fwww.brightmine.com%2Fuk%2Fresources%2Fhr-strategy%2Fworkforce-planning%2Fcost-of-employing-low-wage-staff-to-hit-record-high%2F&amp;linkname=Cost%20of%20employing%20low-wage%20staff%20to%20hit%20record%20high\" title=\"Email\" rel=\"nofollow noopener\" target=\"_blank\"><\/a><\/div><\/div>\n<\/div>\n\n\n\n<p class=\"\">Published: 3 January 2025 | <strong>Personnel Today<\/strong><\/p>\n\n\n\n<p class=\"\">The think-tank claims that businesses will create fewer positions because of a 60% increase in taxes due to impending rises in employer national insurance contributions and a lower threshold at which it is paid.<\/p>\n\n\n\n<p class=\"\">In 2024, an employer paid \u00a31,617 in NICs for each full-time employee on the minimum wage, it points out, while in 2025 it will have to pay \u00a32,583. This means it will cost businesses \u00a32,367 this year to employ a full-time worker on the minimum wage.<\/p>\n\n\n\n<p class=\"\">The Centre for Policy Studies said that the &#8220;tax wedge&#8221; (the portion of a salary given over to tax) has fluctuated since the minimum wage was introduced in 1999. In 2010, it was 18%, and in 2015 went down to 11% when the Coalition Government increased the personal allowance on tax.<\/p>\n\n\n\n<p class=\"\">This year it will rise to 21.3% of salary, it argues, up from 17.5% last year. Businesses also face a rise in the minimum rate in April, when the national living wage increases from \u00a311.44 to \u00a312.21 per hour.<\/p>\n\n\n\n<p class=\"\">The Treasury is also gradually aligning wage rates for 18- to 20-year olds and over-21s so there is one single adult national living wage, which could increase costs over time.<\/p>\n\n\n\n<p class=\"\">&#8220;The more of an employee&#8217;s salary is owed in tax &#8211; whether paid by the employee or directly by the employer &#8211; the more costly it is for businesses to create and sustain jobs,&#8221; said Daniel Herring, tax and fiscal researcher at the Centre for Policy Studies.<\/p>\n\n\n\n<p class=\"\">&#8220;Increasing taxes on employment harms businesses and workers alike. By making it more expensive to employ people, the hikes in employer&#8217;s National Insurance disproportionately affect the lowest paid or those who are looking to move back into work after being economically inactive.&#8221;<\/p>\n\n\n\n<p class=\"\">Kevin Poulter, employment partner at law firm Freeths, said the increased costs could stymie growth for small businesses and start-ups.<\/p>\n\n\n\n<p class=\"\">&#8220;That said, National Living (minimum) Wage increases happen every year and many businesses choose to enhance pay further, including through commitments to the voluntary real Living Wage, bonuses and worker incentives.<\/p>\n\n\n\n<p class=\"\">&#8220;In some cases, sadly, increased labour costs may lead to cuts to the workforce through redundancies, recruitment and pay freezes. Businesses which rely on large numbers of lower paid employees, such as manufacturing and hospitality, will feel the hit the most.<\/p>\n\n\n\n<p class=\"\">&#8220;This comes at a time when competition from countries offering cheap labour remains high and opportunities for offshoring work will hit the UK workforce the hardest,&#8221; Poulter added.<\/p>\n\n\n\n<p class=\"\">Last month, the CIPD warned that employers would need more support to prevent job losses as the cost of running a business increased.<\/p>\n\n\n\n<p class=\"\">It urged the Government to be aware of the disproportionate impact on smaller businesses, and advocated more guidance for those affected.<\/p>\n<\/div>\n\n\n\n<div class=\"wp-block-group alignfull has-alabaster-gray-background-color has-background has-global-padding is-layout-constrained wp-block-group-is-layout-constrained\" style=\"margin-top:0;margin-bottom:0\">\n<div class=\"wp-block-group alignfull has-primary-white-background-color has-background has-global-padding is-layout-constrained wp-container-core-group-is-layout-bbb7e64f wp-block-group-is-layout-constrained\" style=\"padding-top:var(--wp--preset--spacing--40);padding-right:var(--wp--preset--spacing--30);padding-bottom:var(--wp--preset--spacing--40);padding-left:var(--wp--preset--spacing--30)\">\n<h2 class=\"wp-block-heading has-text-align-center has-large-font-size\">Start your free trial today<\/h2>\n\n\n\n<p class=\"has-text-align-center has-medium-font-size\">Register today to gain free 7-day access to the Brightmine HR &amp; Compliance Centre and stay up to date, compliant and save valuable time<\/p>\n\n\n\n<div class=\"wp-block-buttons is-content-justification-center is-layout-flex wp-container-core-buttons-is-layout-a89b3969 wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link has-primary-white-color has-secondary-blue-background-color has-text-color has-background has-link-color wp-element-button\" href=\"https:\/\/hrcentre.uk.brightmine.com\/freetrial-login\/?loggedInUrl=%2Ffreetrial%2Fnew-user%2F&amp;registrationUrl=%2Ffreetrial%2Fnew-user%2F&amp;intcmp=hrcc-resources|cta-2-col|light|banner|hrcentreuk-freetrial|take-a-free-trial\" style=\"border-radius:100px\" target=\"_blank\" rel=\"noreferrer noopener\">Take a free trial<\/a><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-group has-primary-white-background-color has-background has-global-padding is-layout-constrained wp-container-core-group-is-layout-fcdab8bb wp-block-group-is-layout-constrained\" style=\"border-radius:25px;margin-top:var(--wp--preset--spacing--30);margin-bottom:var(--wp--preset--spacing--30);padding-top:var(--wp--preset--spacing--40);padding-right:var(--wp--preset--spacing--30);padding-bottom:var(--wp--preset--spacing--40);padding-left:var(--wp--preset--spacing--30)\">\n<h3 class=\"wp-block-heading\" style=\"font-size:clamp(17.905px, 1.119rem + ((1vw - 3.2px) * 1.383), 28px);\">About the author<\/h3>\n\n\n\n<div class=\"wp-block-columns is-layout-flex wp-container-core-columns-is-layout-658170e2 wp-block-columns-is-layout-flex\">\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\" style=\"flex-basis:100px\">\n<figure class=\"wp-block-image size-full is-resized has-custom-border is-style-rounded\"><img loading=\"lazy\" decoding=\"async\" width=\"128\" height=\"128\" src=\"https:\/\/cdn.brightmine.com\/wp-content\/uploads\/sites\/2\/2024\/03\/12085308\/Brightmine_Favicon_128px.png\" alt=\"\" class=\"wp-image-313\" style=\"border-radius:25px;object-fit:cover;width:100px;height:100px\"\/><\/figure>\n<\/div>\n\n\n\n<div class=\"wp-block-column is-vertically-aligned-center is-layout-flow wp-block-column-is-layout-flow\">\n<p class=\"\"><strong>Brightmine<\/strong><\/p>\n\n\n\n<p class=\"\">With more than 10,000 customers, Brightmine is a leading global provider of people data, analytics and insight \u2013 empowering HR leaders to deliver brighter business outcomes.<\/p>\n\n\n\n<p class=\"\">For more than two decades, Brightmine, formerly XpertHR, has continued to help HR leaders confidently navigate the evolving world of work through our unique combination of critical workforce data, AI-enabled technology, and trusted HR expertise.<\/p>\n\n\n\n<p class=\"\">Brightmine is a division of LexisNexis Data Services within RELX\u00ae, a global provider of information-based analytics and decision tools. RELX serves customers in 180+ countries with 35,000+ employees. Ticker: London: REL; Amsterdam: REN; New York: RELX.<\/p>\n\n\n\n<p class=\"has-primary-black-color has-text-color has-link-color wp-elements-ad14550bb07010b79fc22eb0ca4e129e\">Follow Brightmine on <a href=\"https:\/\/www.linkedin.com\/company\/brightmine\/\" target=\"_blank\" rel=\"noreferrer noopener\">LinkedIn<\/a><\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>The cost of employing low-wage workers will hit a record high in 2025, according to an analysis by the Centre for Policy Studies.<\/p>\n","protected":false},"author":11,"featured_media":10632,"comment_status":"closed","ping_status":"closed","template":"resources","categories":[52],"tags":[],"topic":[81,78,29],"class_list":["post-10320","resources","type-resources","status-publish","has-post-thumbnail","hentry","category-hr-news","topic-employee-taxes","topic-minimum-wage","topic-workforce-planning"],"_lnrs_read_more":"","yoast_head":"<!-- This site is optimized with the Yoast SEO 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