What the autumn financial statement means for you and your employees.

Last week we heard from the new chancellor when his eagerly awaited autumn budget was delivered. During this we heard him confirm that the UK had entered into a recession, and with that some tough decisions had to be made to support some growth.

2023 looks set to be another tough year as an employer, and especially for those of us in HR and people management as there was little help offered in the way of support for the current financial crisis, skills shortage or for small business owners. 

Here’s a quick overview of the main points announced: 

  • 45% rate of income tax will be paid on earnings over £125,140, instead of £150,000.
  • Local councils in England will be able to raise council tax by up to 5% a year without a local vote, instead of 3% currently
  • Energy cap increases to £3000 from April 23 and energy grant only available to those who meet a set criterion 
  • The windfall tax on the profits of oil and gas firms has been increased from 25% to 35%, and extended until 2028
  • a new 45% tax on companies that generate electricity will apply from January
  • Minimum wage to increase to £10.42 from April for over 23s
  • State pensions and benefits to increase in line with inflation at 10.1%

I’ve been in HR long enough to appreciate that the effects of announcements like this will impact many employers and employees alike, both financially and emotionally. Where uncertainty is high it is usually cupped with low motivation, lack of confidence in things like job/business security or spending power, and these can lead to higher stress and anxiety levels. 

Looking after the mental health of employees at times like this are crucial to keep up motivation, engagement and ultimately productivity. The statement was based on growth and stability and that is a great way to think of support for yourself and your employees. 

What can you do that’s within your control to create both growth and stability in your life (personal or business)? 

Being mindful of the potential stresses that can impact is a great start, as a business owner, HR or people Manager it goes a little deeper, opening up conversations with employees and colleagues can help support this. Being clear in communications, I can’t stress this enough really, especially if your business is facing tough times and difficult decisions ahead. Engaging with your teams and being clear can help reduce anxiety and stress. Believe me, if you’re worried about the future there’s a sure chance your employees are too. 

By opening up and having open and honest conversations, you can gain buy in and focus on what is really needed rather than risk employees becoming demotivated and looking for alternative options. I’ve seen many options play out here and I can say with my hand on my heart that those who are open, honest, and clear with employees, come through these challenges in a better position than those who don’t.

HR people and managers, it’s in times like these that you’ll need to be creative with your benefit packages, it’s time to think outside the box. Especially if a salary rise is not on the cards, which for many it may not be. It’s not easy but it is possible and actually in many businesses it can really transform morale, loyalty and productivity.

What the autumn financial statement means for you and your employees.