Firms find it harder to offer pay rises
Published: 10:50, 24 March 2011
Updated: 10:50, 24 March 2011
By Business Editor Trevor Sturgess
Inflation and higher National Insurance is making it hard for firms to take on staff and offer pay rises, and the Budget has not made it much easier.
That was the assessment of Neil Edwards, former Kent banker who founded The Marketing Eye, which serves clients across West Kent.
He was among the majority of Kent business chiefs who broadly welcomed a Budget "for growth," although Shepherd Neame boss Jonathan Neame denounced the Chancellor's "idiocy" for adding 10p to a pint of beer, warning it would threaten more pub closures and job losses.
Mr Edwards said Chancellor George Osborne was saying a lot of the things that small businesses wanted to hear, such as making Britain the best place to start up, finance and grow.
But there was little in the Budget to make it cheaper and easier to take on staff.
He said: "Finding the cash for pay rises is difficult in the current climate and it's made harder if anything you do offer is negated by inflation and increased National Insurance."
He welcomed the rise in personal allowances that could make his staff a little better off.
"For our business to grow, we need confidence in the economy and people willing to invest in their businesses. Despite Osborne talking about "economic stabilit", there is still a lot of uncertainty out there. Rising inflation rates and threats of increases in interest rates don't help."
Without confidence, firms needed costs to be held down and "the ability to leave as much profit in the business as we can to re-invest - not paying it all out in tax".
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