Commenting on the news that the Government looks set to agree an increase in the National Minimum Wage (NMW) to €11.30 per hour from January 2023, Small Firms Association (SFA) Director Sven Spollen-Behrens, said: “Costs for small business owners are at a never seen before high. It is disappointing that Government are now adding to these by imposing a further increase in the NMW.
“A minimum wage increase would be on top of the existing significant cost pressures facing small firms – energy, transport, insurance, materials, technology, and operating costs in general are all rising in price faster than small businesses can keep up with.
“This is not the only increase in labour costs being imposed on small firms in the coming months. A statutory sick pay scheme will come in to affect in the final quarter of this year, and the Automatic Enrolment Retirement Savings System will be set up in 2023 for employee enrolments in 2024. The cost of labour is the most significant driver of business costs in small firms amounting to 82% of overall monthly costs, these cumulative impacts are causing major concern amongst Ireland’s small business community.
“Ireland cannot allow its competitiveness to be eroded through costs imposed by Government. The energy crisis makes it all the more important to manage the costs that are within our domestic control. Budget 2023 must provide certainty and maintain competitiveness”, Sven concluded.
SFA Budget 2023 priorities:
- Postpone the phased introduction of the Living Wage (2024 to 2027) and maintain the National Minimum Wage Rate.
- Government must seek to coordinate legislation and new regulations’ administration burden in a phased manner.
- Apply the SME Test across Government Departments to reduce the regulatory burden on small business.
Ensure comprehensive help for all small businesses to deal with the energy crisis by ensuring that policy decisions do not exclude our smallest employers.