Autumn Statement 2023
Chancellor Jeremy Hunt has today released his Autumn Statement, bringing forward measures on NLW, alcohol duty, business rates and NI that will have an impact on the industry and its workers.
The National Living Wage will see an increase of 9.8% to £11.44 an hour, averaging an additional £1800 a year per full-time employee. This new rate now also applies to employees who are 21 and 22 years old – previously, it was only for workers over the age of 23. Though beneficial for the staff, this rise means a typical pub will see labour ratio hike around 3 percentage points. In addition to this increase, employee NI will drop from 12% to 10%, though employer contributions to NI have not been cut.
The extension of business rates relief is good news, and will help around 230,000 smaller retail, hospitality and leisure businesses in 2024-25. It also seems the Chancellor has listened to calls for alcohol duty to be frozen, meaning there is one less cost for operators to worry about until August next year.
Chief Growth Officer at S4labour, Richard Hartley, commented: “We have spoken to operators who are currently struggling with labour ratios of 34%+, so this further increase in spend will be challenging, and we anticipate this will put pressure on consumer prices. As wages continue to rise, managing the cost is going to be the single-most important factor in the future success of our industry.”