The Rising Cost of Hiring: Is It Time to Reconsider Your Business Strategy?
Elizabeth Wright
Helping Small Business Owners & Entrepreneurs Achieve Growth Through Reliable Virtual Assistant Services | Specialising in Organisational Efficiency & Access to Work Support
Introduction
The latest budget has set the new minimum wage at £12.21 an hour from April 2025. While this aims to support workers, it places additional pressure on small businesses. Let’s explore what this means and look at a cost-effective alternative.
The Cost of Hiring an Employee for 16 Hours per Week
Hourly Wage: £12.21
Weekly Hours: 16 hours Weekly Wage: £195.36
Annual Wage (52 weeks): £10,158.72
Additional Employer Costs
National Insurance Contribution: £61.90 annually
Pension Contribution: £117.56 annually Statutory Sickness Pay:
Employers must cover statutory sickness pay, which can add to costs.
Recruitment Costs Estimated Time & Effort for Hiring: £1,000 per post (higher if using a recruitment agency).
Training Costs Training a New Employee: Estimated at £1,000.
Total Annual Employee Cost (16 Hours/Week): £12,338.18
Comparison with a Virtual Assistant
Admin and More VA Rate for 20 Hours/Month Package: £550 + VAT per month
Annual VA Cost (12 Months): £6,600 + VAT
No Additional Costs: No NI, pension, or adjustments. Flexible Engagement: Adjust hours based on business demand. Closing Thought: With rising employment costs, consider a more predictable and scalable option like a Virtual Assistant.
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Stopping the small business rollercoaster, helping business owners get off! ▪︎ Business & Marketing Consultant ▪︎ Speaker
2moVery accurate until the end of the calculations. Comparing a member of staff for 16hr/week on minimum wage vs a VA on a 20hr/month package isnt equal.
Financial Educator and Friend protecting your savings against loss so you can achieve prudent and profitable growth.
2moLooks like good common sense every which way to me.
Human SEO Copywriter | Getting the BEST clients for SME owners by writing web copy (and all kinds of word stuff) that's Clear, Concise & Compelling | Copywriters' Mentor
2moThat's an admirably persuasive argument Elizabeth Wright. Excellent! 🙂