Rising National Insurance Costs Are Squeezing UK Small Businesses, Can Virtual Assistants Offer Relief?

In 2025, many UK small businesses are struggling with rising costs, and among the most pressing is the increase in National Insurance (NI) contributions. As the government seeks to balance the budget and support public services, employers have found themselves shouldering higher NI payments — a move that's straining already tight margins.

For small business owners, especially those with fewer than 10 employees, these changes aren’t just a line on a spreadsheet - they’re a threat to sustainability. Hiring even one full-time employee now comes with significantly increased costs, not just in wages but in the employer’s NI contribution, currently sitting at 15% for most salaries. For businesses recovering from the economic impact of Brexit, COVID-19, and inflation, these additional expenses can feel like the final straw.

The Impact on Growth and Hiring

One of the most immediate consequences is a slowdown in hiring. Small businesses that had plans to expand their teams are now putting those plans on hold. Others are looking at ways to cut costs, which often means reducing hours, freezing recruitment, or even redundancies.

Administrative roles, customer service, and marketing support are often the first areas where small business owners try to save - not because they’re unimportant, but because they’re perceived as more flexible. This is where a growing number of SMEs are turning to virtual assistants (VAs).

Outsourcing to a Virtual Assistant: A Flexible Alternative

Virtual assistants offer a cost-effective and scalable solution. Unlike traditional employees, VAs are typically self-employed or work through agencies, meaning employers don’t pay National Insurance, pensions, or other benefits. This instantly reduces overheads without sacrificing quality or professionalism.

A skilled VA can take on a wide range of tasks, from managing email and booking appointments to handling social media and customer inquiries. They work remotely, often on a flexible hourly or project-based rate, making it easier for businesses to pay only for the time they need — no desk space, no equipment, no long-term contracts.

Real-World Benefits for Small Business Owners

For small business owners, the advantages go beyond cost savings. With a VA handling time-consuming admin, they can focus on growth, sales, and innovation. They gain more hours in the day without committing to a full-time hire — an ideal middle ground in uncertain economic times.

Virtual Assistants can bring a fresh perspective and specialist skills. This can give businesses access to talent they might not otherwise afford if hiring in-house.

While rising National Insurance costs present real challenges, they’re also pushing small businesses to rethink how they build and manage their teams. Outsourcing to a virtual assistant isn’t just a short-term fix — it could be part of a longer-term shift toward more agile, cost-effective operations.