“Salons Like Ours Are Being Pushed Into An Impossible Corner”

Nov 27, 2025 | HOME INFORM, INDUSTRY NEWS, INFORM, INFORM HEADER

“Salons Like Ours Are Being Pushed Into An Impossible Corner”

The Autumn Budget 2025 – your reactions

by AMANDA | INFORM

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With the reveal of the Autumn Budget 2025, salons are now facing National Minimum Wage hikes from April, alongside other changes. How will this latest wave of government changes impact your salon business?

Share your views now – the British Hair Consortium are collecting instant responses from salons ahead of a government meeting on 8 December

“With the new budget increasing minimum wage for apprentices, salons like ours are being pushed into an impossible corner. As a hybrid salon, we already juggle rising costs and limited margins and these changes make it even harder to hire and train new talent.

It’s financially unviable to bring apprentices into the industry, putting the future of hands-on learning at real risk. A VAT reduction to 10 per cent is no longer a luxury; it’s essential for our survival. Without it, salons simply won’t be able to absorb these rising costs and the high street will lose yet another vital trade.”

Warren Edwards, Warren & The Hare, Bournemouth

“I’ll be honest, this Budget was disappointing for our industry. Once again, hair and beauty barely earned a mention, despite our contribution to the economy and our role in training thousands of young people. Hospitality was recognised; we weren’t, which leaves me frustrated.

“The biggest issue is that the VAT system continues to favour micro-businesses staying under the £90k threshold. There’s absolutely nothing wrong with self-employment – it’s an important, valuable part of our industry – but the system unintentionally pushes people towards it. An employed stylist in a VAT-registered salon contributes almost three times more tax than a self-employed stylist under the threshold, yet salons offering apprenticeships, training and career progression face the highest operating costs. That imbalance holds back growth.

“The rise in the National Minimum Wage is the right move ethically, but it will stretch salon payrolls further. This is where knowing your KPIs becomes essential. Profitability is basic maths. Align your pricing, wages and service structure to the numbers, and tough decisions become clearer. Sometimes you must remove emotion to make the decision, and put the emotion back in once it’s made.

“I remain optimistic, but we need recognition and fairer reform. Without it, we risk weakening the very salons who train the next generation.”

Lorenzo Colangelo, The Gallery, Tunbridge Wells

“As the owner of a salon who takes on apprentices, the increase in the minimum wage – including for apprentices – means our labour costs are rising sharply at a time when overheads are already tight. This puts real pressure on hair salons, where staffing is a major cost, and it forces us as salon owners to make tough decisions, raise prices, reduce staff or limit how many apprentices I can take on. It’s a difficult balance. I want to support the next generation of stylists, but I also need to keep the business afloat.”

Charlotte O’Flanagan, Charlotte Paints Hair Studio, Shirley

“While headlines focus on minimum wage rises and business support, the reality on the salon floor is quite different. The increase in the National Minimum Wage will cost a salon with five stylists around £5,200 extra per year, and that’s before we factor in any changes affecting apprentices. With margins already incredibly tight across the industry, this level of additional wage pressure will force many salons to make difficult decisions at a time when they are already trying to absorb rising product, energy and rental costs.

Rates relief changes offer a glimmer of hope, but only if the Scottish Government responds with equivalent support. As a Scottish business, we’re watching closely and hoping this Budget puts pressure on Holyrood to deliver tangible relief. Without it, many salons in Scotland will find themselves at a competitive disadvantage.

What’s most concerning is that, despite all the noise, this Budget brings very little meaningful change. With income tax thresholds frozen, many people will actually see their take-home pay decrease as they fall into higher tax brackets. For industries like hairdressing, this is significant. When clients feel the squeeze, discretionary spending is often the first to tighten – and salon visits, colour services and treatments are directly affected.

There was talk of support for apprentices, but the detail is vague and appears to be focused on England. Without clear UK-wide measures, salon owners are left with uncertainty at a time when stability is desperately needed.

Ultimately, this Budget doesn’t reflect the day-to-day challenges facing our industry. Salons are creative hubs, employers of young people, trainers of future talent and vital contributors to local high streets. We needed clarity, fairness and support. Instead we’ve been left with a budget that, in all honesty, feels a little ‘blah’.”

Colin McAndrew, Medusa Hairdressing, Edinburgh

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“Salons Like Ours Are Being Pushed Into An Impossible Corner”

What You Need To Know About The Autumn Budget 2025

Tax, Rates And Wage Increases Are Coming. Can Hairdressing Businesses Cope?

What You Need To Know About The Autumn Budget 2025

Nov 26, 2025 | HOME INFORM, INDUSTRY NEWS, INFORM, INFORM HEADER

What You Need To Know About The Autumn Budget 2025

Rises to National Minimum Wage rates sees salons further squeezed

by AMANDA | INFORM

Increases to the National Minimum Wage have been revealed in the Autumn Budget, meaning additional pressure for salons across the country.

The NMW rate for 18 to 20-year-olds will go up 8.5 per cent, from £10 to £10.85 per hour. The rate for over-21s will rise 4.1 per cent in April, from £12.21 to £12.71 per hour, as part of a plan to establish a single rate for all adults. Under-18s and apprentices will get 45p more to push the rate to £8 per hour.

The news comes as the Government cracks down on those not paying employees National Minimum Wage, with more regular public naming and shaming of employers breaking the rules.

The Treasury said the new rates for 2026 struck a balance between “the needs of workers, the affordability for businesses and the opportunities for employment”. Yet the BBC has reported that there is “widespread evidence” that employers have reduced hiring, shared lower pay rises to other workers or raised prices for customers as higher wages push up running costs.

The NMW increases are on top of a 6.7 per cent rise for over-21s and a 16.3 per cent rise for 18 to 20–year–olds respectively in Rachel Reeves’ Autumn Statement last year. That was alongside a 1.2 per cent rise in employer National Insurance Contributions plus a drop in the threshold that businesses start paying them from £9,100 to £5,000. The changes were estimated to cost the hair and beauty industry £139m, according to a report from the NHBF earlier this year.

Elsewhere, income tax and National Insurance thresholds will be frozen until the end of the 2030/31 financial year. Salary-sacrificed pension contributions will be taxed, and tax on dividends increases 2 per cent. The Office for Budget Responsibility (OBR) is predicting inflation will rise higher than initial predictions – 3.5 per cent instead of 3.2 per cent.

“This Budget was far from the ‘fair and necessary’ action our sector urgently needed”
Caroline Larissey, NHBF chief executive

“For small businesses continuing to navigate the current financial climate, the decision to freeze income tax thresholds until the end of 2030/31 offers some certainty for planning and forecasting,” said Lesley Blair MBE, the chief executive of BABTAC and a previous advisor to HM Treasury. “However, the freeze on National Insurance thresholds will effectively increase employer contributions as wages rise with inflation, adding further pressure on already tight margins.”

She added that several other measures announced in the Budget are likely to place additional strain on both employers and employees. “The move to tax salary-sacrificed pension contributions removes a valuable incentive for staff savings and adds another cost consideration for employers. With the OBR forecasting inflation to rise higher than expected, businesses may feel the squeeze on operating costs, while customers themselves face shrinking disposable income. The 2 per cent rise in tax on dividends will particularly affect owner-operators who pay themselves this way. The cumulative impact with National Minimum Wage rises could challenge the commercial viability of many small salons, potentially leading to price increases or reduced staffing.”

Caroline Larissey, chief executive of the NHBF, added that the Budget delivered “little for the small, people-focused businesses at the heart of every high street”. “Hair and beauty is one of the most accessible and empowering routes into work for women, young entrepreneurs and neurodiverse individuals,” she said, “yet this Budget was far from the ‘fair and necessary’ action our sector urgently needed.”

“Our members have been clear: salons and barbershops are already at breaking point following the last round of wage rises and relentless cost pressures,” she added. “Hair and beauty employers have always backed fair pay, but the Chancellor cannot keep loading costs onto small businesses without offering the support needed to keep them trading and providing opportunities in every community.

“If the Government truly wants to grow the economy, end low pay and keep high streets open, today’s wage announcement must be matched with serious support on National Insurance, business rates, skills and enforcement.”

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“Salons Like Ours Are Being Pushed Into An Impossible Corner”

What You Need To Know About The Autumn Budget 2025

Tax, Rates And Wage Increases Are Coming. Can Hairdressing Businesses Cope?

Feb 17, 2025 | DOCUMENTS, DOCUMENTS HEADER, EXPLORE

Tax, Rates And Wage Increases Are Coming. Can Hairdressing Businesses Cope?

From April, hairdressing employers will pay more in National Insurance, as well as a higher Minimum Wage. In a special edition of our On The Floor series, Creative HEAD gathered business owners from across the UK to discuss the impact of Labour’s controversial first Budget

by CATHERINE | DOCUMENTS

In April 2025, significant rises in National Minimum wages and employers’ NI contributions will come into force, driving up operational costs and squeezing profit margins for many hairdressing businesses at a time of fragile post-pandemic recovery.

For many small business owners already struggling to keep their heads above water, the additional costs announced in Chancellor Rachel Reeves’ first Budget will be crippling. There is talk of a curtailing of new hires, a need to make existing roles redundant and even business closures.

If you’re one of those contemplating your rising cost base, the words of Eeyore from Winnie the Pooh might spring to mind: “Could be worse – not sure how, but it could be.”

However, some are pushing such gloomy thoughts aside and embracing the challenge by finding ways to offset extra costs.

Creative HEAD gathered a group of hairdressing business owners – a mix of employers, rent-a-chairs and hybrids – at a virtual round table to discuss how the impending changes are impacting on their plans for the future.

Upcoming Changes Announced In The Budget

Employers National Insurance Contributions (NICs)

From April 2025 the rate of employers’ NICs will increase from 13.8 per cent to 15 per cent. The level at which employers start paying NICs (the secondary threshold) will also reduce from £9,100 to £5,000 per year.

To help small businesses offset the increased NIC costs, the Employment Allowance, which helps eligible employers reduce their NIC liability, will increase from £5,000 to £10,500, and the £100,000 eligibility threshold will be removed.

Business Rates

April sees a scaling back of the business rate relief, with the current 75 per cent discount to be replaced by a permanent discount of 40 per cent, up to a maximum of £110k per business.

Wage cost increases

Significant Minimum Wage rises are coming into force in April 2025*:

A rise in the National Living Wage for those aged 21 and over at more than double the rate of inflation (from £11.44 to £12.21 per hour).

A 16.3 per cent increase in the National Minimum Wage for those aged 18 to 20 (from £8.60 to £10.00 per hour).

And an 18 per cent increase for those aged 16 to 17 and apprentices (from £6.40 to £7.55)

*The April 2025 rates represent the largest increase on record for the 18- to 20-year-old rate. The Government has also made clear they want the adult NLW rate to be extended to cover 18-year-olds in the future.

Q1 It’s fair to say the Budget has caused consternation in the business community, but which element will most impact on your business strategy as the new legislation comes into force this year?

For the majority of our panel, the biggest impact on business will come from the changes to employers’ NICs and the National Minimum Wage.

However, the increase in NICs wasn’t the killer – it was the reduction in the threshold that caused the biggest shock. Almost everyone is looking at making tough choices because of those rising costs, and apprentices are a major concern.

Those with apprentices talked of cutting numbers or not replacing them when their current cohort qualifies, while acknowledging the medium- to long-term impact on their future workforce of having fewer apprentices on board.

“We run our business as self-employed, but employing apprentices was something we were hoping to build up to in the future. Now, after seeing the Budget, we’ve been put off. I genuinely don’t know how people can afford them.”

_______

“We are fully employed with a team of 35, and we’ve worked out that the rate increase and the NIC threshold reduction are going to add around £30,000 to our wage bill. We will raise our prices in March or April to help cover that increase but our view is that later on in the year we will drop our apprentices from four to two. And the sad thing is that we rely on our apprentice programme for our stylists to come through, so that will be quite difficult in terms of our future workforce.”

_______

“The most disgraceful thing [the Government did] was reducing the threshold from £9,100 to £5,000. That is disproportionately hitting part-timers. If you’ve got one person on £150k, it will cost you £2.5k. If you’ve got 10 part-timers on £15k each, it’ll cost you an extra £10k. That’s insanity. So, supporting people like young mums, who come in at 10am and leave at 3pm, is now the most expensive increase in our labour cost.”

_______

“I run four salons in south London and around 75 per cent of our staff are employed, so [the Budget] is going to have the most enormous impact on our costs. The real frustration for me and other salon owners is that I don’t think the Government understands how the impact is disproportionately terrible for hairdressing. I can’t think of any other industry where the labour cost is around 60 per cent of turnover – we are overlooked in that respect.”

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“In the past, if I saw a great 19-year-old, I would have said, ‘Come on board, you could be worth the investment.’ Now I will probably think very differently. I am petrified for the future of apprentices in our industry.”

_______

“After many years of being a passionate employer, it became obvious that my team could walk off and earn so much more money self-employed, so I switched my business to chair rental. I was mid-transformation when the Budget hit and all I could think was, ‘Thank Christ I did that!’”

Q2 What action will you need to take to ensure your business can survive and thrive over the next 12 months?

As well as raising prices (which can neatly be blamed on the Budget, and clients will understand), there was lots of talk of working meticulously through the P&L to make cutbacks, too.

Apprentices are in the firing line, but so are those unique luxury extras for clients – one business owner talked of reducing the size of his coffee cups because clients are increasingly asking for more expensive oat milk; another said they would stop offering baker-crafted branded biscuits and go back to Biscoff.

However, we also heard how some are looking at the positives of their business, “shutting out the noise” to focus on what they’re brilliant at and working hard to raise awareness of those USPs and to deliver a business that is flexible and responsive to both clients and team.

“I can’t make progress if I’m feeling anxious or negative. What I need to do is take practical steps to ensure that my business is sustainable. I’ve set aside the whole of this first quarter of 2025 to completely rework my business model. I need to look at every single line, I need to take it all apart and then put it back together in a model that works, that will tell me what I need to do with my pricing, my contracts, my apprentices, my stylists.”

_______

“We have decided we need to be stricter on targets, so we now have a weekly huddle on a Monday morning to clarify our goals – we’re not drifting into anything anymore. We are trying to plan and make sure that every member of the team knows where they are financially.”

_______

“I will be looking at my pricing and actually trying to understand it better (it’s always been a bit messy). I’ve been using the Maddi Cook calculator and putting it all on a spreadsheet and seeing how an increase could help me. This is definitely an excuse to blame the Government. I can be blunt with clients and say, ‘My staff deserve a decent wage and this is the only way we can afford it.’”

_______

“We’re going back to basics – facts and figures. How much do we need to make? How are we going to do that? What skills will be required? We’re letting that inform us how we need to address the Minimum Wage, the business rates and so on. I feel you can get caught up in the noise, what’s going wrong, whereas we need to think about what we’re good at, what we’re offering and how we will achieve that financially.”

_______

“For us, it’s been an exercise of consolidation. We’re trying to bring everything back in-house, which will require a bit of restructuring and like everyone has said, there’s no room for any fat. We’re looking at efficiencies, really trying to work out where we can make savings, while bringing up those service standards so that clients feel they’re getting value. What’s scaring me a little is that we put up our prices every April and they will have to go up significantly this April, so we’re having to work out how to present that to clients without spooking them.”

Q3 What action would you like the hairdressing sector to take to support your business over the next 12 months?

It was widely felt that industry organisations are not making our position clear to Government. There is a distinct feeling that hairdressing is not understood, and we need to be more vocal in sharing our real issues.

There was talk about the need to raise the reputation of hairdressing. The public needs to see that we are not the Wild West – that hairdressing is a legitimate industry, and we invest in our people. For the first time in a while, the issue of compulsory registration was raised and there were calls for training organisations to be vetted and rated.

Business owners are also taking a hard look at their suppliers, many of whom have just announced price rises. It would be good if those account managers and reps could be there to offer business support, rather than just trying to sell more product…

“I think the industry bodies that are supposed to represent us are doing a bad job. A couple seem tone deaf in terms of the impact of [the Budget] changes on our industry. We are lumped in with beauticians and cosmetics brands so what’s presented to the Government is actually a muddled picture about growth, when actually if you drill down the trend in hairdressing is a total exodus from employment into self-employment and businesses deliberately staying below the VAT threshold, which creates an unlevel playing field.”

_______

“The organisations who represent us are run by people who are not hairdressers, none of them own salons. It’s effing ridiculous!”

_______

“I do think that not having a voice is an issue for us. Salon ownership is at an all-time low. So, if someone is doing a survey of hairdressers and asking them what the problems are, the results are not going to be representative of the issues that we [as business owners vs independents] are facing, because only a small percentage of respondents will be running a business and having to deal with these very real issues following the Budget. If the Government is being told, for example, that 90 per cent of the industry is managing, then why would they take any notice of the other 10 per cent? We’re getting to the point where we can’t train anybody anymore and nobody’s coming through as a result. That message needs to be clearer.”

_______

“I think we need to register hairdressers. I think there needs to be some kind of clampdown on standards in training organisations because some of them are shockingly bad.”

_______

“With the bigger brands, obviously, the more you spend, the more support you get. But when you’re trying to support the smaller independent brands, they just don’t have the ability to deliver that. So, it’s all a bit tough, it’s treacle out there – it’s sticky.”

1“The 18 per cent increase to apprentice wages is disastrous. It spells the end of people coming into the industry.”

Q4 What action would you like the Government take to address some of the negative impacts of the Budget on your business moving forward?

VAT was an issue brought up by all – how a reduction in the rate and/or in the threshold would make a huge difference, although nobody saw any VAT change on the cards. The predominant feeling is that all hair pros providing a service should be paying similar taxes and all should be VAT-registered. That would create a level playing field that would make business ownership and employment more sustainable – and that needs to be better explained to Government.

“I’d like to see Government give us a VAT that is proportionate for service industries. I know they do that in Ireland (VAT for hairdressers is charged at a reduced rate of 13.5 per cent versus the standard rate of 23 per cent) but I’d like to see it go further. I’d like to see them make every independent stylist charge VAT as well to give us more of a level playing field. So, if you’re a practising hairdresser you should have a VAT number.”

_______

“When it comes to VAT, [the Government] needs to realise that we are an industry that works on totally different principles to an awful lot of the High Street, and yet we’re bundled in with the same set of responsibilities and it just doesn’t work. They also need to understand that we are a craft and that for us to be able to train and pass on that craft we need better financial support. Through economic necessity, assistants are being asked to go onto the floor too quickly.”

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“VAT is just the killer. It’s so depressing watching your business grow and then seeing how much tax you have to pay and how little you can offset. Every week, when I put that money into to the pot I use to pay my VAT, I just feel like, What’s the point?’”

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“We all know that in barbering there are so many crooks on the high street, and it sucks knowing that we work so hard and are doing things properly while there are 30 other barber shops down the road doing cash in hand and probably making more money than us.”

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“Government has to understand that our industry is labour-intensive. They’ve got to level the playing field. Everyone has to be VAT-registered, whether you work from a shed or from a salon in Mayfair. And I think they need to reward employers that train people, that’s also key. Until that happens, it’s all going to become more and more of a challenge. But I do think salons that can survive the next three or four years are going to be smashing it, because if you can keep your head until then…”

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British Hair Consortium Publishes Survey Results Following October Budget Announcement

Nov 7, 2024 | HOME INFORM, INDUSTRY NEWS, INFORM, INFORM HEADER

British Hair Consortium Publishes Survey Results Following October Budget Announcement

The survey included responses from 1,686 industry employers representing over 21,000 workers

by MADDI | INFORM

Following the October 2024 Budget announcement, the British Hair Consortium (BHC) has released survey results, summarising the initial reaction from the industry and highlighting significant concerns for the UK hairdressing sector.

The survey showed that 42 per cent of respondents say they are considering closing their businesses within the next year. 98 per cent of salon owners are exploring self-employment models for their staff, with many feeling that switching away from the direct employment (PAYE) system may be necessary for survival. This shift away from traditional employment could have implications for the industry and workers alike, as noted by Hellen Ward from the BHC: “Many workers relinquish their employment rights in exchange for promises of more money in their pocket. Furthermore, many of these unscrupulous business owners use this model as a vehicle to avoid VAT by splitting income at worker level.”

Apprenticeships, which play a crucial role in developing the next generation of hairdressing talent, could also be at risk. 95 per cent of salon owners who currently employ apprentices say they will reduce their intake, end apprenticeships or decide not to take on any more trainees. BHC’s Collette Osborne commented on the complex legal challenges salon owners face in determining legitimate employment models, noting that “the truth is that our industry has no clear understanding of guidelines on what a legitimate and legal business model is. Salon owners who fall foul of the law only find this out when they are hit with fines that often are so high, the business has to close anyway and, in many cases, end in bankruptcy.”

Image by Christopher Bill

BHC representatives warn that such a shift could impact not only the livelihood of salon workers but also have broader economic consequences. A loss of PAYE contributions, reductions in VAT and a decline in apprentice numbers threaten to destabilise the sector and diminish government revenue from the hairdressing industry. Office for National Statistics data supports these concerns, showing a decline of 45,000 employees, or 37 per cent of the workforce, in the hairdressing sector since 2018.

The survey revealed that 94 per cent of respondents are either extremely concerned for the future or believe a generation of apprentices will be lost, and 98 per cent of respondents do not believe the hair sector is valued by the government.

Amid this uncertainty, Toby Dicker from the BHC emphasises the importance of unity in the industry to navigate the challenges ahead: “There’s never been a greater need for the industry to join together to ensure that everyone is trading under the correct terms. If you want to be properly represented then join one of the six business organisations that are most representative of our industry.”

The BHC continues to advocate for sector reforms, underscoring the urgency for clear guidelines and support to sustain the future of British hairdressing.

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Hairdressing Employers In Firing Line From The Biggest-Ever Tax Raid Budget

Oct 30, 2024 | HOME INFORM, INDUSTRY NEWS, INFORM, INFORM HEADER

Hairdressing Employers In Firing Line From The Biggest-Ever Tax Raid Budget

As widely expected, the new Labour Chancellor has lifted employers’ National Insurance Contributions, but the drop in the threshold at which businesses start paying it is pretty startling – from £9,100 to £5,000.

by CATHERINE | INFORM

Today (30 October 2024), in Labour’s first Autumn Statement in 14 years, the Chancellor Rachel Reeves announced a Budget that will raise taxes by £40bn.

The biggest hitter was an increase of 1.2 per cent in employers’ National Insurance Contributions, which means the rate will rise to 15 per cent in April 2025. At the same time the government will also reduce the secondary threshold from £9,100 to £5,000, in a move that will raise £25bn a year by the end of the forecast period. Before the Budget, employers were liable for a rate of 13.8 per cent of workers’ earnings above £175 a week.

However, Reeves also announced that the employment allowance will rise from £5,000 to £10,500.

She said: “This means 865,000 employers won’t pay any National Insurance at all next year and over one million will pay the same or less than they did previously.

“This will allow a small business to employ the equivalent of four full-time workers on the National Living Wage without paying any National Insurance on their wages.”

Reeves used the Budget to reiterate yesterday’s announcement that minimum wages will rise in April 2025 as follows:

The minimum wage for over 21s, known officially as the National Living Wage, will rise by 6.7 per cent, from £11.44 to £12.21 from April 2025. For someone working full time, or a 37.5-hour week, that equates to £23,873.60 a year, up from £22,368.06.

For 18- to 20-year-olds, the minimum wage will rise from £8.60 to £10. This means someone on a 37.5-hour week will earn £19,552 a year, up from £16,815.

Apprentices will get the biggest pay bump, from £6.40 to £7.55 an hour. That means their annual wage will go up to £14,762 from £12,513 currently.

According to The Treasury, the hike in the minimum wage for under-21s – the largest on record – marked the first step towards a single rate for all adults.

Image by Sarah Agnew

“It’s a particularly bad day for hairdressing and beauty businesses and the end of the road for apprentices and employment within our sector” – Toby Dicker of the Salon Employers’ Association.

In more bad news for high street hairdressing businesses, the current 75 per cent discount to business rates – due to expire in April 2025 – will be replaced by a discount of 40 per cent, up to a maximum of £110,000. That means that many businesses will see their business rates nearly double.

Among the other announcements were: an increase in Capital Gains Tax, a freeze on fuel duty next year and the introduction of VAT on private school fees from January 2025.

In her opening remarks Reeves says the UK had voted for change, and that the Labour government has a mandate for a decade of “national renewal”.

She pledged “more pounds in people’s pockets” and improved living standards. The only way to drive economic growth is to “invest, invest, invest”, she added.

The government must “restore economic stability and turn the page on 14 years” of Conservative government, Reeves said. She says the Labour party has rebuilt the UK economy before and will “rebuild Britain once again”.

“In the grand scheme of things we are a niche industry that the government simply doesn’t understand, and we have become collateral damage” – Louise Howard-Long, Architect Hair, Leeds

However, hairdressing business owners and organisations reacted with dismay as Reeves set out her government’s taxation priorities, which come against a backdrop of higher debt following the pandemic, higher interest rates and inflation that has only recently returned to normal levels.

“It’s a particularly bad day for hairdressing and beauty businesses and the end of the road for apprentices and employment within our sector,” said Toby Dicker of the Salon Employers’ Association.

“After years of tireless campaigning with the Department for Business and HMRC and trying to show how tax policy directly affects apprentices, our industry, which is hit five times harder than retail by employment cost increases, has been broken.

“We have no alternative but to lay off apprentices and move all our staff to self-employment to have any chance of survival.”

(Toby has created an online calculator to help business owners understand the impact of the Budget. For access to the calculator, email admin@salonemployersassociation.co.uk)

Said Louise Howard-Long, owner of Architect Hair in Leeds: “Of course, people deserve to be paid well. But in the grand scheme of things, we are a niche industry that the government simply doesn’t understand, and we have become collateral damage. I fear for the future of hairdressing. More and more people are being pushed into the grey economy and at some point, the government will wake up and realise they’re missing out on a lot of income that they used to get from our industry.”

Sam Kendall, chief operating officer at salon booking, management and marketing system SalonIQ, also warned that today’s Budget might impact on hair businesses’ future hiring plans.

She said: “Experts have rightly dubbed this an effective ‘tax on jobs’, raising fears that it will stifle hiring, slow wage growth and limit pension contributions. For salon and barbershop owners striving to build a strong team and provide fair pay, this could be a critical setback, many having to reduce their team sizes and let non income producing apprentices go.

“In an environment where confidence is crucial for investment and growth, these changes risk sending small salon and barber businesses into a cycle of stagnation.

“Salons often take the hit in these situations, however the cost of running a business is not sustainable as costs keep rising. Salons will have no choice but to increase their prices to absorb these costs and should aim for an increase on their services of 4 to 5 per cent. Whilst we remain positive, some will sadly have no option but to close their doors.”

Image by Christopher Bill

“Salons will have no choice but to increase their prices to absorb these costs and should aim for an increase on their services of 4 to 5 per cent” – Sam Kendall, COO, SalonIQ

And while Caroline Larissey, chief executive of the National Hair & Beauty Federation, welcomed the rise in the Employment Allowance, she too voiced concern about the impact of the minimum wage increases.

“With 16 per cent+ rises in the youth wage rates there was nothing on interim support for businesses training young people,” she said.

“The only ‘youth guarantee’ for our sector will be that small and micro employers won’t be able to afford to take on apprentices.

“While the Employment Allowance increase offers some breathing room, the dramatic rise in apprentice wages threatens to disrupt the traditional pathway into our sector. Without targeted intervention, we risk creating a skills gap that could take years to bridge. The government’s approach to retail business rates shows they’re listening, but more comprehensive support is needed to ensure the sustainability of apprenticeships in hair and beauty.”

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