Recently the Chancellor Rishi Sunak announced a raft of measures aimed at supporting jobs in the UK as the country transitions from lockdown into a challenging economic future. But what does it mean for the valuable SME sector?
The Chancellor started by expressing the desire to ensure no one is left without hope and stating an intention to give business confidence to retain and hire staff. He acknowledged that the challenge is significant, and the road will be long, but for those who are in a position to benefit from his latest plans there is plenty to be happy about.
Kickstarting young careers
One of the Chancellor’s headline announcements was a £2bn scheme to subsidise six-month work placements for those aged 16 to 24 and on Universal Credit. The idea is that this will give young people valuable work experience in a challenging job market and will hopefully lead to job opportunities after what effectively amounts to a six-month subsidised probation period.
This could be a great way for SMEs to bolster their workforce temporarily as their businesses and demand for products and services begin to return to normal. But it will do little to support those industries requiring highly skilled employees and, while welcome, is only a temporary measure.
Training and apprenticeships
The Chancellor didn’t leave the skilled sector un-catered for however. Additional money to take on more trainees, apprenticeships and for skills training has also been promised which should provide a welcome incentive for employers.
Speaking of incentives, Rishi Sunak also reiterated his position that a continuation of the furlough scheme would be unsustainable and irresponsible. However, an incentive to bring back furloughed staff amounting to £1,000 per employee will be paid. Perhaps a welcome ray of light to those industries that are able to bring staff back on stream. However, it does leave a question mark over industries where trading is restricted by ongoing lockdown restrictions.
Investment in a green recovery
The Chancellor had already announced a £2bn voucher scheme for homeowners to make energy efficiency improvements which is expected to create around 140,000 jobs in the sector. He also announced a fund for improving the energy efficiency of public sector buildings. Surely good news for businesses in this sector and part of a government plan to rebuild responsibly.
The housing sector
Stimulating the housing market was seen as key to generating demand, and therefore jobs, in lots of sectors from construction to retail. As expected, the Chancellor announced a temporary increase in the stamp-duty threshold to £500,000 meaning 9 out of 10 transactions will now be exempt of stamp-duty. For SMEs involved in retail of home-ware, DIY, and of course those in estate agency and conveyancing will hope to see an increase in business as a result.
A package of support for hospitality and tourism
Mr Sunak singled out the hospitality and tourism industry for special attention, citing the employment of a disproportionate number of young people, women and people from BAME backgrounds. VAT will be cut to just 5% for food, accommodation and attractions giving a much-needed reprieve to struggling businesses and a shot in the arm to consumer confidence. In addition to this the Chancellor announced a headline grabbing, “never-before-seen”, government-backed 50% off meals out on Monday-Wednesday’s throughout August to encourage people to “Eat Out to Help Out”… It only remains to be seen if this encourages people to put their fears to one side and return to restaurants.
The Chancellor’s plan will have its critics, of course, and I am sure many will be left fearing they may fall through the cracks. But on the whole, I think we need to see these announcements as positive. British business has always been, and always will be, about finding a way to thrive in whatever circumstances life throws at you. Anyone who has been in business for long enough will tell you that ideal conditions don’t really exist – so let’s do what we do best and take what help we can and find a way through the rest.
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