'We can go harder on new hires' - channel reacts to Chancellor's announcement

Rishi Sunak reveals plans aimed at minimising unemployment and saving jobs

The tech industry has reacted positively to parts of the Chancellor's "mini-budget" statement today, praising moves to boost employment opportunities for young people.

Rishi Sunak's statement in the House of Commons was largely focused on saving and creating jobs, particularly for people under the age of 24.

The so-called "Kickstart Scheme" will see the government subsidise the cost of work placements for people on Universal Credit, while companies that create apprentice roles will be paid £2,000 per apprentice.

"Our plan has a clear goal: to protect, support and create jobs," Sunak said.

"It will give businesses the confidence to retain and hire. To create jobs in every part of our country. To give young people a better start. To give people everywhere the opportunity of a fresh start."

Softcat managing director Colin Brown said the Kickstart Scheme could enable the reseller to go further than it had already planned in terms of on-boarding.

"I think the budgetary statement provides some great opportunities for both young people and for employers," he said.

"Softcat's employment focus is predominantly graduates and in the last few years, a growing number of apprentices. We haven't furloughed anyone or made any redundancies since COVID-19 began, and as we enter our new financial year beginning in August we have a budget that adds a significant number of new hires.

"The announcements made by the Chancellor may well enable us to go harder on new hires and take advantage of what I believe will be a fantastic talent pool. We'll be analysing the detail of the announcements as soon as they become available."

Dave Stevinson, managing director at software distie QBS also praised the move, adding that there should be a focus on the tech industry.

"It is immensely pleasing to see the government support the young at this most challenging time and the traineeship programme looks incredibly beneficial for both the employers and the young people.

"The TMT (technology, media, and telecom) sector remains a very exciting place for young talent."

Meanwhile Neil Murphy, CEO at Bytes, said: "The focus on getting young people into employment is a good opportunity for the IT industry to help get the economy moving again and to help address the skills gap while doing so.

"These are positive steps, but it's likely that more will need to be done to aid the recovery.

"We have seen demand for software solutions from public and private sector organisations outstripping our expectations from March through to the end of June."

Channel recruiter Marc Sumner said the initiatives like the new job retention bonus - which pays employers £1,000 for every furloughed employee that is brought back until the end of January - will go some way to addressing mass unemployment, but ultimately will not be enough.

"It feels a bit putting a plaster on a wound," he said.

"Let's be honest, if you're bleeding and all you've got is a plaster you'll take it, but I think we need more than a plaster here.

"Yes it's a welcomed bonus, but I don't think it's enough. There are a lot of companies that are bleeding out there and to get the economy hiring again we're going to need more."

Prior to the announcement, Tech Nation chair Stephen Kelly said that the UK needs a "tech-led recovery."

"Pre-Covid-19, the Tech sector was growing six times faster than the rest of the economy, and predictions show that by 2030, 50 per cent of the UK economy will be digital, tech and creative industries," he claimed.

"The Tech sector already employs almost three million people, representing an engine room of high-value, highly skilled and well-paid jobs, with salaries that are, on average, £10,000 higher than other sectors.

"We would like to see the Government work closely with technology companies, focusing on the creation of new apprenticeships and digital training schemes, specifically targeting those regions outside of London."

Sunak also announced moves to boost some of the hardest hit industries in the country. VAT in the hospitality sector will be reduced to five per cent, while the threshold for Stamp Duty will be raised.

The Labour Party criticised the government for its "one-size-fits-all" approach and the lack of a full budget, and called for an extension of the furlough scheme, which Sunak promptly ruled out.