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Pensions auto-enrolment could lead to 200,000 job losses

Auto-enrolment into pension schemes could result in 200,000 job losses, a study by the University of Warwick has found.

The study, by the university’s Institute for Employment Research department, has found that auto-enrolment into qualifying employer pension schemes and personal accounts from 2012 could lead to 200,000 job cuts due to a 2 per cent rise in labour costs for firms.

The IER’s Bernard Casey says administration costs, the range of salary levels of potential scheme participants and the possibility of take-up rates meeting Government expectations, could see labour costs rise by 2 per cent for firms, 1.4 per cent higher than the Pension Commission’s 0.6 per cent prediction.

Casey says the higher costs could “weaken” small firms, and “lead to business failures and redundancies”.

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