The True Cost of Hiring in 2025: Why UK SMEs Are Turning to Virtual Assistants

The financial landscape for UK small businesses in 2025 has shifted dramatically. With the National Living Wage (NLW) rising to £12.21 per hour and the employer National Insurance Contributions (NIC) threshold lowered to £5,000, many business owners are facing their toughest staffing decisions yet. 

A recent report by London Loves Business found that nearly 50% of SMEs are deeply concerned about the financial strain caused by these increases — with some warning that they may need to freeze hiring or reduce hours to survive. 

It’s a stark wake-up call. And for many small business owners, particularly those with 1–5 employees, these pressures are forcing a complete rethink of how they resource their businesses. 

The Real Cost of a “Part-Time” Employee 

Hiring someone for just 20 hours a week might sound like a manageable commitment — until you dig into the true cost. 

Here’s a breakdown of what that hire could cost you annually in 2025: 

• Base salary: £12.21/hour × 20 hrs/week × 52 weeks = £12,698.40 

• Employer NIC (15%): approx. £1,900 

• Employer pension contributions (3%): approx. £380 

• Holiday entitlement (5.6 weeks pro-rata): £1,370 

• Sick pay allowance: New SSP obligations add further liability 

• Training & onboarding time: £500–£1,000+ 

• Recruitment time or agency fees: £1,000–£2,000 

Total: £17,000–£19,000 — and that’s for someone working half the week. 

And remember, that cost is fixed. Whether your workload dips, your new hire is off sick, or your business takes a temporary pause, you still have to pay. 

When We Faced This at Admin and More… 

At Admin and More, we faced this reality head-on in 2024. 

Despite loving our team and being deeply committed to creating local employment, we had to make difficult decisions when costs spiralled. The rising NIC rates and wage increases meant that keeping the workforce as it was would have made the business unviable. 

Instead of closing our doors, we pivoted. We restructured, we streamlined, and we built up our Virtual Assistant (VA) offering — not just for clients, but within our own business too. 

The result? We didn’t just survive. We became more focused, more efficient, and more flexible — able to meet demand without being locked into fixed costs or carrying the HR burden. 

The Rise of the Virtual Assistant 

Virtual Assistants aren’t new — but in 2025, they are quickly becoming the go-to choice for small businesses who want to maintain quality without the compliance stress. 

A Virtual Assistant is a self-employed professional who works remotely to deliver admin, operations, marketing, finance, or client support. You only pay for the hours you need — and none of the hours you don’t. 

No pension. No NICs. No sickness liability. No payroll. No employment contracts. 

Just support, when and how you need it. 

A Client Case Study: Small Agency, Big Results 

One of our clients, a small marketing agency in Manchester, had previously hired a junior assistant on a part-time basis to help with admin and content posting. 

They quickly found themselves overwhelmed: 

• They were paying nearly £1,200/month after all costs 

• Training and hand-holding was draining their time 

• Sick leave and school holiday gaps caused missed deadlines 

• Despite everything, the backlog never got cleared 

In January 2025, they switched to a 20-hour/month VA package with us at £550/month. 

By March: 

• Their inbox had been reorganised and was being actively managed 

• Their LinkedIn scheduling was fully automated 

• They had onboarded two new clients without lifting a finger on paperwork 

• They saved over £600/month and had zero employment admin 

The director told us: 
“I didn’t realise how much I was paying to feel constantly behind. Now I feel like I’m running the business again, not chasing it.” 

Why VAs Make More Sense Than Ever 

Hiring an employee ties you down. 

• You pay 52 weeks a year 

• You’re responsible for managing performance, legal obligations, and morale 

• You carry the risk — even when times are quiet 

Outsourcing to a VA is low risk, high reward: 

• Scale up or down as needed 

• No hidden costs 

• Clear deliverables 

• UK-based professionals who understand your market 

• Hours tracked, outcomes delivered 

And if things don’t work out? There’s no disciplinary process. Just stop the service. 

The Numbers Don’t Lie - find out more about how we can help you - either with a FREE consultation call or by trying our Get to Know You Package.