A nursery owner says she has started applying for a second job to keep her staff in work over fears she won’t be able to pay them once minimum wage increases come into force.
Sharon Birch, 56, has run her business in Hartlepool since 2006 and claims she earns less than £15 per hour despite her huge responsibility.
But she has now started actively looking for more work on the side of her business in preparation for when the National Living Wage for over-23s rises from £8.91 to £9.50 from next April.
Ms Birch currently employs around 30 staff.
“I can't afford to pay the minimum wage increase,” she told The Mirror.
“We win awards, we are outstanding, but the money is horrendous. What business owner has to take another job to keep their staff in work?
“The alternative is to close and everyone loses their job. It's a high stress job and I do my very best.
“The only source of income is parents but how can I charge them fees to cover the increase in wages?
“Our overheads are huge and 75-80% of income goes on staff wages.”
This year alone, more than 3,000 early years providers have already been forced to close as the result of sustained financial pressure, according to the Early Years Alliance.
But Ms Birch says she fears many more nurseries could be forced to shut their doors for good without support from the Government.
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She said: “Of course workers should have a fair wage, absolutely, but this is a big increase that can only be met by paying parents that are already stretched.
“Any increase they may receive will be negated by rising costs of living and childcare. It's a false premise.”
Ms Birch also fears the extra childcare support announced by Chancellor Rishi Sunak in his Budget won’t protect businesses like hers.
The Chancellor announced £300million for 'A Start for Life' parenting programmes, with an extra £170 million by 2024/25 going into paying for childcare.
Announcing the package, Mr Sunak said it includes around £80million to create another 75 family hubs across England.
A further £100million will go towards supporting the mental health of expectant parents, while £120 million will be invested in other comprehensive family support programmes.
“It won’t be implemented until 2024/25 - how are we supposed to survive until then?” asked Ms Birch.
Neil Leitch, CEO of the Early Years Alliance, said: "While it is absolutely right that all staff receive fair pay for the work they do, news that the national living wage is set to rise to £9.50 next year - alongside other significant minimum wage increases for younger workers - is likely to cause fear and worry throughout the early years sector.
"Over recent years, funding for the so-called ‘free childcare’ offers has seen only marginal increases in the face of significant rises in the living and minimum wage.
"Given salary costs account for around three-quarters of provider costs, the increases confirmed today are likely to represent nothing short of an existential threat to many early years settings across the country."Read More Read More