Is Employer’s National Insurance the Achilles’ heel of small businesses?

In their monthly newsletter, People Per Hour have recently found freelancing to be ‘the winner of the recession’, amidst their findings in a survey of 530 small businesses. The statistics show that since the beginning of the recession, the temp sector has gained a 5% market share, whilst all other recruitment sectors have shrunk, and continue to do so despite overall economic recovery.

Given that the FSB are running an online petition urging the Government to freeze the National Insurance rate to give small businesses a chance of survival, does this not suggest that employer’s National Insurance is one of the greatest flaws in the conventional business model? The solution: follow the example of the small businesses interviewed by People Per Hour and use freelancers instead! The results are in and the report finds that by using freelancers, small businesses save ‘23% of their total staff costs’.

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