27.11.2025
The Autumn Budget has landed with the usual noise: tax tweaks, fiscal forecasts, and the perfunctory political theatre.
Among the key announcements, there has been a freeze on income tax thresholds until the 2030/31 financial year.
The biggest cost is the Employer National Insurance, which will be payable on all salary sacrifice pension contributions exceeding £2,000 per annum from 2029. This legislative change is a long way off and may never ultimately be enforced, but employers should be aware that a national insurance charge will apply on salary sacrifice pension contributions exceed £2,000 per annum. This will also apply to employees.
Alongside this, the Government has confirmed that minimum wage rates will increase in 2026, giving a pay rise to millions of workers. From next April, the National Living Wage will rise by 4.1% to £12.71 an hour for eligible workers aged 21 and over, which the Government said will benefit over 2 million workers. The National Minimum Wage rate for 18 to 20-year-olds will also increase by 8.5% to £10.85 an hour, narrowing the gap with the National Living Wage. For 16 to 17-year-olds and those on apprenticeships, the National Minimum Wage will increase by 6% to £8 an hour.
Broadly, the budget sets the tone for how UK industries build productivity, compete for technical talent and respond to structural labour shortages. While headlines will focus on cost of living and taxation, the real story for employers continues to sit underneath: skills, workforce resilience and the ability to deploy specialist capability at pace.
Real GDP is forecast to grow by 1.4% on average over 2026, 0.5% slower than originally projected, due to underlying productivity problems.
So, for employers working at the sharp end of aerospace, defence, infrastructure, energy, power, and tech, only one question matters:
Will the Budget make it easier or harder to access, shape, and deploy the skilled talent that drives productivity?
Here’s the clear signal. And here’s how we’re perfectly placed to help.
Priorities for employers
The 2025 Budget delivers a package that aims to combine fiscal discipline with renewed investment, and those investments land squarely in the sectors Morson Edge serves: infrastructure, energy, technology, aerospace, defence and built environment.
- The Budget keeps strong public and capital investment in infrastructure, transport, energy networks (such as nuclear), health and housing, sustaining a pipeline of major programmes.
- Regulatory and planning reforms aim to speed up approvals for housing, infrastructure and energy projects, helping shorten lead times on delivery.
- Business environment support: reforms to encourage innovation, better R&D incentives, and measures to ease compliance burdens for scaling firms and innovators.
- A focus on “unleashing talent and opportunity”: investments via skills/ training funds, youth employment and support for bringing more people into work, which is relevant for long-term skills pipelines.
Unleashing talent and opportunity
The government is making over £1.5 billion available across the spending review period into the Youth Guarantee and the Growth and Skills Levy. This will tackle the elevated number of people not in education, employment or training (NEET) rates, with the Youth Guarantee ensuring all young people aged 16-24 years old have access to the support they need to earn or learn. Reforms to the visa system will make sure UK businesses have access to the brightest and best global talent.
Sustained capital investment means sustained demand for technical skills
The Budget endorses continued high-level capital investment across transport, energy, housing and infrastructure; these are heavy engineering, systems and project environments.
That means demand will remain high for: systems engineers, project managers, design & build teams, commissioning & validation specialists, power/energy engineers, infrastructure planners, and digital/IT integration talent.
Skills investment and employment support strengthen long-term talent supply, but not for immediate hires
The Budget includes measures to support youth employment and skills training. Good for future talent pipelines – but it doesn’t solve short-term contractor or specialist hiring needs.
In short: if you wait for “the pipeline to catch up” you risk missing delivery windows.
What employers should do now
1. Map and stress-test your skills and delivery plan based on pipeline visibility
Use the Budget’s investment signals to reinterpret your 12–24 month hiring and project plan. Which projects are likely to restart or accelerate? Which skills will surge in demand?
Solution: Our performance diagnostic gives you a single view of how your people strategy, delivery model, and social impact intersect – and where you can unlock productivity, efficiency, and value.
2. Blend long-term hiring with flexible, project-ready contracting capacity
Permanent hires build capability. Contractors deliver speed and flexibility, especially for projects that scale up fast post-Budget.
Solution: If you need skilled people in fast, without compromising on compliance, cost control, or quality, our contingent talent capability can plug into your business and ensure projects don’t slip.
3. Engage early with compliance, scope and status planning
With regulatory and planning timelines compressing, specifications and contracting windows will tighten. Get scopes, contracts and compliance structures locked early.
4. Use this moment to tie workforce strategy to delivery ambition
If you’re scaling for energy, infrastructure or systems work, this Budget provides a window. Build a workforce strategy that’s aligned to pipeline and capital flows, not to short-term cash cycles.
Solution: Enter, Morson Nexus. We link training with real-world work to help organisations upskill, reskill, build long-term workforce capability and stay competitive in fast-changing industries. Because it’s not just the workforce of today you’ll need to lock in – it’s the skills of tomorrow.
The window won’t stay open long. If you want certainty, speed and ready-to-go teams, now’s the time to act. Get in touch with us and find out how we can help deliver your ambitions.
