Western Europe sees UK as lowest cost for employers

20th August 2012

We came across an interesting article from HRReview on the UK being a surprising force in competitiveness of employment costs. In an age where all we hear about is a heightened level of tax, we found this refreshing and encouraging. We have summarised accordingly.

For employees, Britain seems like an expensive place to earn your living in the current day and age but a recent report has suggested that this could soon be coming to an end. In an international world, it is becoming increasingly commonplace for companies to open factories and premises outside their country of origin. Operating elsewhere means that they can avoid the hefty taxes and levies that their home can sometimes impose on them, and it’s recently emerging that the United Kingdom is a country which offers some of the best rates for companies and businesses.

The cost is made up of tax and pension contributions, amongst other things, and skews massively as you travel across the continent. With employees taking home in the region of £30,000 per annum, a company can expect to pay less than £4000. The modern business hubs of Dutch and German cities are following closely but just across the border in France, companies can expect to be hit with a numbing £14,000: over three times the cost.

This is a surprising difference to see in such a geographically small area, perhaps the Eurozone crisis will have a bearing on the day-to-day life of Britain after all. With the United Kingdom looking all the more attractive for prospective employers to establish themselves within, perhaps we can be expecting the job boom that we so desperately crave. 

Britain is still ahead if you shave £10,000 off the average earner. Employers will be paying about £2,500 for their workers who are earning around £23,000, followed again by the Netherlands and Germany and France being a repeatedly embarrassing four times more expensive.

The report shows a different conclusion as you move in the opposite direction. Those with employees earning in excess of £65,000 should look to Spain and Holland as their tax breaks, with Italy this time being stamped with a rubber seal of disapproval; employers having to pay almost half of that salary in taxes. 

However, we can’t expect to see an instant increase in production line facilities coming to Britain. China is still leading the market in rock bottom employer costs and they will continue to be a driving force in the mass production market. Worryingly, the business super machine that is New York City can still beat the UK’s costs.


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