Sara’s Blog – 8th October 2021
Response to PMs and Chancellor speeches at the Conservative Party Conference and the Kickstart scheme extension
I am all for being optimistic but wonder if it is a high-risk strategy to hope, as the Prime Minister does, that this is just a period of “adjustment” and that rising wages will ride to the rescue, rather than make inflation worse and end up in a dangerous spiral.
Firms are dealing with a cumulative crisis in business conditions as supply chains crumble, prices soar, taxes rise, and labour shortages hit new heights. In the past, even one of these issues would have resulted in interventions and the development of a strategy.
The economic recovery is still new and if it stalls, private sector investment and tax revenues that the PM wants to fuel his vision will be another thing in short supply.
We all want a move to a high wage economy, but this will not happen overnight. It requires government and business to come together to develop a strategy which deals with the current challenges while meeting longer term ambitions and driving up productivity. And there is much to be said for a highly skilled workforce needed for this – whilst not forgetting that there are jobs which are not necessarily highly skilled but are essential to our way of life. People in these jobs need better recompense too.
Right now, targeted immigration may be a sensible way to smooth the critical national skills shortages – and the wages could be quite high for these roles too if market forces operate. Firms need to be given breathing space to plan and invest in skills and technology needed to bring the future closer.
The PM recognises skills as being fundamental to levelling up and economic prosperity. A more agile skills system is key to boosting business investment in training and innovation. Local Skills Improvement Plans should be rapidly rolled-out to give businesses a stronger voice in skills planning and it is good to see chambers across the country being lead partners in the pilots of this approach.
The PM stated that levelling up cannot be seen as one part of the country against another. It’s about tackling blockages to prosperity in every community and giving every business and every person the same opportunities to grow. It is also about health – the health inequalities in this country are shocking with a difference of 12 years life expectancy between some parts of the county.
The upcoming Budget must focus on injecting momentum and confidence across all regions and nations of the UK, with measures aimed at underpinning a sustained economic revival and addressing longstanding issues. This should include addressing the increasingly onerous cost of doing business in the UK and to finally deliver fundamental reform of our broken business rates system.
While the four-month extension of employer cash incentives for hiring new apprentices is good news for many employers, we would like to see the grant extended to the end of 2022. This will allow more time for those SMEs still recovering from the pandemic to create new apprenticeship opportunities that will increase technical skills in the workplace, tackle skills shortages and boost productivity. We welcome the increased investment in training for developing industries involving AI and innovative technologies as these skills will support employers in key sectors for our economy going forward and we need plans for more support for care workers and those on the factory floor or in the driving ca, too.
Businesses support fiscal responsibility, but decisions should be based on economics, not politics. Ultimately, it is businesses as wealth creators which generate prosperity, create jobs and support communities. The focus should be on creating the best possible environment for businesses to grow and thrive so they can sustainably deliver the tax revenue needed to return our public finances to a sustainable path.
Finally, the Kickstart scheme has been extended for three months to the end of March 2022.
The Chambers administer Kickstart in the Staffordshire and we have already overseen 1440 approved placements. The scheme offers funding of 100 percent of the relevant National Minimum Wage for 25 hours a week, plus associated employer National Insurance Contributions and employer minimum automatic enrolment contributions. There is also £1,500 per job placement available for setup costs, support, and training.
If you are interested in a Kickstart placement you can contact the Chamber: firstname.lastname@example.org
If you want to talk to us about any business issues, including funding, you can call our switchboard on 01782 202222 or call the Stoke and Staffs Growth Hub Helpline on 0300 111 8002 or email: email@example.com