Following on from the encouraging news on the falling number of unemployed in the Bury North constituency the latest estimates are out of the number of firms who have benefitted from the new Employment Allowance. These show that since its introduction in April 1,200 businesses in Bury North are benefitting.
The Employment Allowance is a reduction in National Insurance Contributions that an employer pays for its employees. The allowance is worth up to £2,000 off the National Insurance bill of every employer and is open to businesses, charities and community amateur sports clubs.
The allowance means a business could now hire someone on £22,400 a year, or four people working full-time on the minimum wage, and not have to pay any employer National Insurance Contributions. This is making it easier for local businesses to grow and create more jobs in Bury, Ramsbottom and Tottington
This tax cut is a key part of our long-term economic plan to back business and secure a better future for Bury and Britain.
I am pleased to see that the number of people unemployed in the Bury North constituency has shown another small decline this month. Of course, nothing dramatic will happen over the course of four weeks but the long term trend on unemployment is encouraging. Of course there is still much more to do and unemployment will only continue to fall if employers have the confidence the economy is going to improve.
Cutting Employers National Insurance by up to £2,000 will also help stimulate growth in the jobs market with thousands of small businesses in Bury, Ramsbottom and Tottington no longer having to pay any employers national insurance contributions at all.
In the last six months the number of people claiming Jobseekers Allowance has fallen by 450 a 25% reduction of over 25%, this is to be welcomed not just because the numbers on a graph are going in the right direction but because it means there are hundreds more people in Bury who now have the security of a regular pay packet.
Since the last general election the number of young people aged 18 to 24 claiming Jobseekers Allowance in Bury North has also been cut – by over a half from 635 to 280.
Today there will be the Second Reading of the National Insurance Contributions Bill. The Chancellor of the Exchequer, George Osborne, announced the introduction of a new Employment Allowance in his Budget Speech in March this year.
Starting in April 2014 all businesses, charities and community sports clubs will be entitled to claim up to £2,000 from their annual payment of secondary Class 1 National Insurance contributions (NICs). Class 1 NICs are paid by both employees and employers on the employee’s earnings. The employee’s share is known as the primary contribution, the employer’s as the secondary contribution. Employers are liable to pay secondary Class 1 NICs at 13.8% on all employee earnings above the secondary threshold which is set at £148 a week.
Whilst all businesses in Bury will benefit it will be of most benefit to the very smallest companies in and to the sole trader looking to take on their very first employee.