At its most extreme, Jet2.com and Jet2holidays has said the increases to NI and National Living Wage will cost £25 million. But with a projected profit of £560-£570 million, it can easily absorb this.

Others won’t find it so painless; The Travel Network Group estimates the average agency will have to sell seven extra holidays to fund an additional £2,000 in minimum wage, NI and pension contributions.

Last month’s Spring Statement brought little consolation, although chancellor Rachel Reeves – citing the Office for Budget Responsibility – forecast the average consumer would be "more than £500 a year better off" under the new government.

If that money heads towards travel agencies, some may cynically wonder whether they can afford enough staff to help consumers spend it.

Taking stock

Idle Travel owner Tony Mann is perhaps one of those in that camp. He estimates the changes will cost his business “an additional £20,000 a year”. “We’ve had to take stock,” he admits. “We’ve looked at cutting our marketing budget by £10,000 and decided, if we were to expand our team, we would hire someone part-time.

“You always hope you’re going to grow year-on-year, but this time will be more difficult as we’ve had such exceptional few years – and now costs have gone up.”

The Scottish Passenger Agents’ Association (SPAA) said it was “deeply concerned” about the increase in NI. When surveyed, nearly three-quarters (74%) of its members reported previous increases in NI contributions had negatively affected profitability, with 8% stating they’ve already had to reduce staff “as a direct result”.

Scottish agents also bear an additional burden with no business rates relief available to them, unlike their peers south of the border.

Hays Travel last year gave a £6 million ballpark estimate of the impact of the NI and minimum wage hikes, stressing it already paid more than the minimum and would therefore adjust its pay up by a similar amount.

With £3 billion in sales, like Jet2, it too can absorb this – but if you’re a smaller player in the agency world, the impact will be that much harder.

Many will seek savings elsewhere, like Travel Designed’s Fiona Field. “We’ve had to reconsider getting our website redone and we’ve cut back on our advertising – we employ a couple of people on an ad-hoc basis to send out leaflets in targeted areas,” she tells TTG.

“We’ve really looked back at what was working for us last year and where we can save.”

Gazelle Travel’s Nick Coulthard is also being cautious. “I was going to take on another member of staff,” he reveals. “But I’ve decided to put that on hold as I want to see what the implications are come April.”

‘Bizarre logic’

There is also the increase in business rates to stomach. “It’s a nightmare,” says Market Place Travel’s Mark Lomas. “We used to have a business rate relief of 75% and now it’s gone down to 40%, meaning we have to pay £450 a month,” he says.

“It’s crazy – the government wants to keep high street shops and local small businesses open. It’s bizarre they’ve gone about it this way.”

Savings will have be made from things like window cleaning and heating, he concedes, adding: “We have parked any further growth of physical stores in favour of growing social media, which doesn’t cost anything.

"We decided it’s financially better to enhance what we’ve got. We have 35,000 followers, but we don’t have 30,000 people walking past the shops, so why open a new store or spend on a shop display when we can do it free on social media?”

Beverley Travel’s Kelly Cheesman warns there will be a time lag to the impact. “Straight away, we’ll probably feel it a little less because of the way our commissions are paid – we will feel it harder at the end of the year when people aren’t travelling and we don’t have that comfort blanket that is the summer cash flow,” she says.

“We’ve not cut any staff hours, and we were already planning to put wages up because we’re living wage employers. We’re still trying to grow the business because the only way to combat higher costs is to grow."

She adds: “Instead of screaming, shouting and stomping our feet, which is what we’d like to do, we have chosen to remain positive, working hard to expand. For example, we have opened a pop-up shop in a different area to gain more footfall.

“We have actually just taken on two full-time members of staff because of shortages within our team. And with the expansion plans we have, we will recruit again.”

Seeing the positives

The grin-and-bear-it attitude was also prevalent among some of the larger businesses TTG spoke to. Premier Travel managing director Paul Waters was upbeat about the increase in minimum wage, seeing the wider picture.

“Increased wages mean workers have higher take-home pay and better living standards, which in turn boosts consumer spending – so more money in people’s pockets to spend on travel,” he says, adding it would not impact Premier’s recruitment.

Meon Travel managing director James Beagrie shared similar sentiments. “It’s not affected our recruitment, but it has kept us honest regarding a living wage and making sure our trainees and apprentices are all properly compensated,” he explains.

“We do our best to uplift what has historically been a low-paid sector to the new levels, rightfully recognising the professional competencies of the people we now attract.”

So there may be a silver lining to this particular economic cloud because, despite all the grumbles, paying people more may – in the long-term – actually benefit the industry.