Salon owners urge Budget VAT cut as staffing pressures grow

Marcus Perkins said rising costs were making it harder for salons to employ staff and train apprentices

After 22 years running a salon, Marcus Perkins says he is increasingly worried about the future of the hair and beauty industry.

Rising costs are making it harder for businesses to employ staff and invest in apprenticeships, he says, while more salons are turning to self-employed models to survive.

"Seeing salons close on the high street is very scary," he said.

"I'm very scared myself.

Luckily it hasn't happened yet but who knows what the future holds?"

Perkins is among more than 2,000 salon owners who have signed an open letter calling on the Chancellor John Healey to cut VAT on hair and beauty services from 20% to 10% in this week's Budget.

The letter is backed by the British Hair Consortium (BHC), which argues rising business costs are placing increasing pressure on traditional salon employers.

However, the industry has also seen growing numbers of stylists move into self-employed arrangements, with hairdressers often renting a chair within a salon rather than being directly employed.

With salon ownership perceived to be out of reach for many, self-employment offered independence, flexibility and higher earnings, industry research suggested, external.

A Treasury spokesperson said hair and beauty businesses played an important role in supporting jobs, apprenticeships and thriving high streets.

They added that the sector had benefited from reforms to business rates.

While traditional salons said they faced rising pressures, a recent report from the British Beauty Council found that hair and beauty salons and shops made up almost a third of all leisure sites across UK retail centres.

It added that those businesses now accounted for greater share of smaller high streets and were equivalent to pubs, bars and cafes combined.

Stylist Trearna Hart fears fewer salons will be able to train the next generation

Salon owners say they have also been affected by increases in wage, pension and National Insurance (NI) costs.

The government's changes to employers' NI contributions and increases to the minimum wage have been defended by ministers as part of wider efforts to improve pay, support public services and drive economic growth.

The BHC said a reduction in VAT would help businesses take on more staff, invest in training and keep more salons trading on the high street.

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Perkins believed it would make a significant difference.

"We can grow the business and employ more people," he said.

The salon owner runs M&M Spa in Quarry Bank, near Brierley Hill, where he says he has trained more than a dozen young people over the past two decades.

Among them is 21-year-old stylist Trearna Hart, who said many of her peers had struggled to establish careers after leaving college.

She said she was fortunate to find an employer willing to invest in her development.

Dorothy Senior says visiting her salon is about more than having her hair and nails done

This year alone, Perkins said he had spent about £2,000 on courses and travel costs to support her training.

"It's upsetting really," he said.

"We help people, we train, we nurture, we mentor.

We help the next generation because if we don't help the next generation, what happens to our future?"

The BHC claimed apprenticeship numbers had fallen sharply and warned the trend could worsen if pressures on employer-run salons continued.

Financial pressures and concerns over inconsistent training standards had led salons to take on fewer apprentices, with 53% of salon owners reporting a reduction, external in the number they trained, according to a Future of Hairdressing report.

Perkins believes businesses that employ and train staff are increasingly competing against models centred on self-employed workers.

He argues that creates an "unlevel playing field" because traditional salons often shoulder the costs of training future hairdressers.

Hart said the number of salons disappearing from high streets was a concern.

"At the rate it's going we're not going to have many salons left open and there's no-one going to be able to do hair," she said.

The challenges facing the sector are also worrying some customers.

Research from the British Beauty Council highlighted the role hair and beauty businesses play in supporting local high streets, encouraging spending and providing opportunities for social connection.

Dorothy Senior has visited M&M for hair and beauty treatments for the past 20 years.

She said the salon was about much more than appearances.