The Global Payroll Association (GPA) found that 89% of UK small-to-medium sized businesses (SMEs) have made staff redundancies due to the Autumn Budget of October 2024.
The Budget increased the national living wage and employer national insurance contributions, putting pressure on businesses.
As a result, more than half of SME owners expressed concern about the cost impacts, with 27% being greatly concerned.
Among those who laid off staff, 93% made between one and five redundancies, while 6% let go of at least 21 employees.
Melanie Pizzey, CEO and founder of the GPA, said: “The fallout from October’s Autumn Budget has been profound, and that’s before the new NLW and NIC rules have even kicked in.
“From April, these staff cost increases will become a reality, and the impact of this could well lead to even further redundancies as SMEs see the true impact for the first time.
“The Government tells us that this ‘short-term’ pain is going to pave the way for long-term gain, but businesses might not have the luxury of time to find out if this is true.”
Pizzey added: “With a new budget coming on Wednesday, businesses of all sizes will be hoping beyond hope that no further tax hikes are introduced before they’ve even had a chance to see how the existing increases will play out.
“And with the nation’s redundancy rate hitting its highest point in nearly five years, the Government will surely be growing increasingly anxious, desperate to see some kind of positive economic outcome from this pain they are inflicting.”
