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Experts have suggested that with high inflation and the prediction of a recession by the end of the year, the labour market will soon reach its peak.

And, while employers are using methods such as increasing pay to both attract and retain staff, the CIPD are warning that they may need to look at other avenues to support their worker’s financial wellbeing.

According to the CIPD’s Labour Market Outlook report, pay award expectations have hit a record high in the private sector, rising to a median of four per cent, the highest of any sector in the Labour Market Outlook’s current time series, which began in 2012. The median expected basic pay increase across all sectors continues at three per cent.

The CIPD warns that it won’t be sustainable to increase pay over the long-term, and so suggests that enhancing overall benefits packages might be the better option to keep and attract their employees.

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Jonathan Boys, labour market economist for the CIPD, said, “We’re seeing some of the highest pay awards in recent history as employers strive to attract and retain staff. However, strong pay growth can’t last forever. To deal with the cost-of-living crisis, employers will have to look at other ways they can support their people. Employer benefits that help reduce the cost of housing, travel and childcare will be of particular value to those on the lowest incomes.

“Forecasts of a recession may dampen employers’ recruitment plans in time, but for now, the UK is still in the grips of a hiring boom, with nearly three in four employers planning to take on more staff. In addition to hiring new staff, employers are also taking numerous measures to keep their existing people by upskilling staff, increasing wages and improving job quality.

“Now is a good time for the government to capitalise on employer appetite for upskilling. It’s vital employers have the right support mechanisms in place to access the training they need. Reform of the apprenticeship levy could help by enabling organisations to spend the levy on training that best suits their business’s needs at this crucial time.”

To find out more about contracting please contact Jaime on 01442 795 100 or email jaime.thorpe@dolanaccountancy.com.

Why Thousands of Contractors Choose Dolan Accountancy

With over 25 years experience in contractor accountancy helping thousands of contractors, freelancers and the self employed, Dolan Accountancy has the specialist skills, reputation and credibility you can trust.

Working closely with our sister company, Contractor Umbrella, it means we can offer one low cost, fixed fee package at £105 + VAT. This gives you the flexibility of using both our Limited Company Accountancy Services and our award winning Umbrella Service, for one inclusive cost.

If you’d like to find out more about how Dolan Accountancy can help you and your business, please give us a call on 01442 795 100 or email sophie.lewis@dolanaccountancy.com or jaime.thorpe@dolanaccountancy.com.

We don’t believe in tiered packages or hidden extra fees, instead we aim to give you everything you need, including:

  • Free Company Formation – This is where it all begins. Once you have decided on an available name, we will form your company free of charge (if using our accountancy services) and it will be ready for you to use in as little as three hours
  • Free use of Contractor Umbrella – With IR35 Legislation changes we understand that sometimes you are required to contract via an umbrella company. We will keep your limited company ticking over, while you work margin free via our sister company, Contractor Umbrella
  • A Dedicated Accountant – Your accountant will be there for any company or personal tax advice that you require. We will never outsource work, even to internal teams
  • Free Access to FreeAgent – We offer all of our clients access to FreeAgent, free of charge
  • Free Business Banking – We have decided to waive our commission so our clients can use Tide free of charge for the first year
  • Unlimited IR35 Status Reviews – We will review all of your contracts for IR35 purposes and provide you with our professional opinion as to its status
  • Free Registered and Director’s Service Office Address – Sometimes you just don’t want your home address on display at Companies House. When you sign up to our accountancy services, we will offer the use of our address as an alternative
  • Your Business and Personal Taxation Needs – This includes Company Accounts, Director’s Personal Tax Return, VAT Returns, Payroll, Corporation Tax and Dividend advice, to name just a few
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