Holistic approach needed to stem unemployment, FSB says

  • 17 Jun 2020

Responding to new Office for National Statistics (ONS) figures which show that the number of claimants of Jobseeker's Allowance and Universal Credit rose to 2.8 million in May, more than double the number seen in the same month last year, Federation of Small Businesses (FSB) National Chairman Mike Cherry said:

“For many of the 17 million people who own or work in a smaller business across the UK, the past few months have been the toughest they can remember.

“As we look to recover from this recession, the Government should take a holistic approach to job market interventions. No single new policy will be enough: reducing employment costs, supporting apprenticeships and retraining initiatives all need to be part of the mix.  


“Nine in ten people who left unemployment to re-join the workforce during the last crash did so via a small business or self-employment so it’s critical that we get this right.

“Four in ten small firms cite labour costs as a primary barrier to business growth. Far more needs to be done to help them manage those costs. A reduction in Employer’s National Insurance Contributions, or further uprating of the targeted Employment Allowance, combined with a widening of NICs holidays, would be a good place to start.

“Over 90% of apprenticeships offered by small firms are held by 16-24 year olds. If the Prime Minister is serious about apprenticeships for young people playing a fundamental role in our return to economic growth, then we need to see more assistance with the time, paperwork and money that goes into training the workforce of the future. There is a strong case for active labour market policies along the lines of the previous Future Jobs Fund.


“The statutory sick pay rebate for small firms with staff who have self-isolate due to covid-19 was a vital intervention. We now either need to see that rebate widened and made permanent or a separate mechanism established to help small firms manage this expenditure – particularly given that many of us may need to isolate more than once as the track and trace strategy takes hold. We’ve seen firms almost driven to the wall because of sick pay costs. The Government must show it’s on their side.”

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