As employment costs rise, so is the use of virtual assistants

April’s changes to National Insurance Contributions (NICs) have left 84% of UK employers facing higher costs of employment, with almost a third reporting a significant rise, according to the latest CIPD figures released this month.

For SMEs already up against tight margins, planned changes to the National Living Wage (NLW) next spring will only compound the pressure. As a result, many firms have no choice but to put hiring plans on hold, which can stunt growth. 

They include Jonathan Moser, CEO at Mo’Living. “Since April, I’ve resisted taking on full-time staff. My property management business now runs entirely with 12 contractors and virtual assistants, both UK-based and overseas,” says Moser.

Could virtual assistants (VAs) be a viable alternative? Offering skilled support without the overheads of a full-time employee, VAs are becoming an increasingly attractive option for business owners who need help but can’t justify the expense of traditional hires.

What is a virtual assistant?

A virtual assistant is a remote professional who provides support to businesses, often on a freelance or contract basis. They can help with a wide range of tasks, everything from social media management, email handling, marketing, and accounting.

The increase in hiring for VAs and contractors is a direct response to a surge in employment costs, largely caused by the rise in employer NICs at the start of April. 

The effects of these tax hikes are already being felt in the job market, as data from QuickBooks shows a decline in job vacancies. 

It’s worth mentioning that some VAs are not people at all, but AI-powered tools which can automate repetitive tasks, such as data entry. That might be one reason why entry-level roles are seeing particularly large drops in vacancies.

Why virtual assistants are winning over SMEs

VAs allow businesses to get additional support while avoiding the extra costs associated with hiring traditional employees.

Instead of committing to paying a fixed salary and NICs, pension contributions, and additional employee benefits, businesses only need to pay VAs their day rate or hourly rate. There’s also added flexibility in that paid hours can fluctuate according to demand, meaning you’ll only pay for what you need. 

In addition, many VAs offer specialist skills, such as marketing, social media, and bookkeeping, sometimes all of the above. This means you can access high-value skills that would be otherwise pricey to hire in-house. 

While a lack of commitment can be a bonus, it can backfire. VAs can leave at any moment, leaving you in the lurch. They may also lack the deep brand knowledge that you would otherwise establish with long-term employees. Having a flow of transient freelancers, rather than a solid, committed team, can also negatively affect your company culture.

Other employers like Moser have already dived into the world of virtual assistance. Kate Allen, who is owner of the Kingsbridge-based Finest Stays, has also gone ‘virtual’.

“The best thing we’ve done lately is trial a VA for a couple of months. No HR hassle, no holiday pay, cheaper than hiring someone full-time, and the quality is excellent”, says Allen.

How to successfully hire a virtual assistant

The growing popularity of VAs reflects a wider shift towards a more flexible, agile workforce. Yes, this trend is partly driven by the rising costs of traditional employment, but it also represents an opportunity. For SMEs, virtual assistance offers a way to access growth and stay competitive, even in a challenging economic climate.

If you’re considering hiring a VA, start by mapping out your priorities. Which tasks are draining your time, and which ones could be handled more efficiently by someone else? Once you know what to delegate, you’ll have a clearer idea of the type of VA you need. 

Professional platforms are a good place to start searching, but before committing, it’s wise to run a trial project. This will allow you to assess a worker’s skills and communication style, plus set out a clear contract with expectations, deadlines, and terms.