Speculation surrounding potential increases to employer pension contributions in the forthcoming Budget has sent 海角视频 firms into turmoil, with some acknowledging it could threaten their financial survival.
Research from consultancy Barnett Waddingham reveals that almost 20 per cent of companies worry they could face insolvency if mandatory rises to employer pension contributions were implemented, as reported by .
Firms have already been compelled to bear extra financial pressures following measures in Rachel Reeves' inaugural budget last year, with the national living wage rising to £12.21 from April 2025.
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National insurance contribution rates also climbed from 13.8 per cent to 15 per cent.
More than 30 per cent of companies acknowledged they would halt recruitment entirely or cut workforce numbers to manage the potential cost increases, adding further strain to an already stretched and troubled jobs market.
Martin Willis, partner at Barnett Waddingham, said: "Even a small increase to contributions could have an adverse effect, disrupting businesses, stalling hiring, and in some cases threatening people's livelihoods.
"These findings highlight the financial tightrope many businesses in the 海角视频 are still walking, exacerbated by the national insurance hike and long-term wage inflation."
Only 17 per cent of the 500 firms surveyed believed they could weather the rise with minimal disruption.
Pension inadequacy
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Whilst companies worry they cannot cope with compulsory auto-enrolment increases, workers are also grappling with mounting fears that the present auto-enrolment system leaves them vulnerable to retirement hardship.
Pension firms have been sounding increasingly urgent warnings throughout this year that the minimum contribution level of 8 per cent falls short of what individuals need to secure their ideal retirement.
Despite these persistent alerts, substantial numbers of people continue to depend exclusively on their workplace pension, with some assuming it will suffice, whilst others cannot access alternative wealth-building methods that previous generations relied upon, such as property ownership.
Particularly concerning is that almost 60 per cent of Gen Z assumes that automatic workplace pension enrolment will provide adequate retirement savings, contrary to industry expert assertions, according to Standard Life research.
The government reinstated the Pensions Commission in July to tackle the retirement emergency and overhaul the framework, though Barnett Waddingham cautioned that reforms must not burden 海角视频 enterprises.
Willis commented: "With pension adequacy a growing concern nationwide, and millions of people at risk of falling short of even a minimum level of income retirement, solving the ticking timebomb of the 海角视频 pension system must be at the top of the government's agenda.
"We need a balanced, sustainable approach that strengthens retirement outcomes for individuals while safeguarding the financial resilience and continuity of 海角视频 businesses."