A Word from Our CEO, Murray Norton, July 2026

Cost of Living, Cost of Business

The cost of living remains one of the biggest concerns facing Islanders today. Whether it is the weekly food shop, housing costs, energy bills or simply the cost of a night out, many households are feeling the pressure.

What is sometimes overlooked is the close relationship between the cost of living and the cost of doing business.

Businesses do not operate in isolation. Every additional cost faced by a business must be absorbed somewhere. Sometimes it comes from reduced profits, sometimes from lower investment, but more often it eventually finds its way into the prices paid by consumers. Put simply, if it becomes more expensive to run a business in Jersey, it usually becomes more expensive to live here too.

Some of these costs are unavoidable. Jersey is an island economy dependent on imported goods, global supply chains and external economic forces. However, others arise from local policies, regulations and administrative requirements that, whilst often introduced with good intentions, can increase the cost and complexity of operating a business.

Take freight and ferry costs. Almost everything sold in Jersey arrives by sea or air. Food, building materials, retail stock and business supplies all depend on efficient transport links. When freight charges rise, whether through fuel costs, operational challenges, changes to freight pricing policies or market arrangements, those increases inevitably work their way through the economy and onto shop shelves. In an island economy such as Jersey, freight is not simply a transport issue, it is a cost of living issue too.

Employment costs provide another example. Most businesses support fair pay and recognise the importance of maintaining living standards. However, increases in minimum wage levels and the move towards living wage expectations create additional costs for employers. Whilst many would argue these policies are both necessary and desirable, the economic reality remains that higher employment costs become part of the price of providing goods and services.

Housing is equally important. As accommodation costs rise, businesses face increasing pressure to offer higher wages simply to attract and retain staff. Housing costs therefore become business costs, which in turn can contribute to higher prices across the economy.

Beyond these direct costs sits the challenge of regulation and administration. Every business accepts the need for employment law, health and safety requirements, consumer protection and environmental standards. The difficulty arises when individual requirements accumulate over time. GST administration, compliance obligations, reporting requirements and licensing processes all require management time and resources. For many smaller businesses, that burden falls directly on owners and managers. Time spent completing paperwork is time not spent serving customers, investing in growth or creating jobs.

Planning delays can have a similar impact. Whether developing housing, expanding premises or investing in new facilities, prolonged approval processes increase costs through professional fees, borrowing expenses and delayed investment. Few would argue against proper scrutiny, but greater efficiency benefits both businesses and consumers.

Population and licensing policies present another balancing act. Jersey must manage housing demand, infrastructure capacity and public services, but businesses also need access to the people and skills required to operate successfully. Restrictions that make recruitment more difficult can reduce productivity, increase wage inflation and add further costs to the economy.

There is also the relationship between government spending and taxation. Public services are essential and contribute significantly to Jersey's quality of life. However, every pound of public expenditure must ultimately be funded through taxes, charges or fees. Businesses often argue that new policies should be assessed not only for their social benefits but also for the administrative and financial burden they place on the private sector.

None of this is an argument against regulation, public services or fair employment practices. Rather, it is a reminder that every policy choice carries economic consequences and that costs rarely disappear. They simply move elsewhere.

As the new Council of Ministers begins its four year term, this may be one of the most important economic questions it faces. When considering new legislation, regulation, taxes or administrative requirements, policymakers should ask not only what a proposal achieves, but also what it costs to implement and who ultimately pays.

There is a final irony in all of this.

CoB is often shorthand for Close of Business. Yet when we discuss the Cost of Business, we should remember that one can eventually lead to the other.

Jersey's businesses are the engine room of our economy. They generate employment, create wealth, fund public services and support our communities. If we make it unnecessarily difficult or expensive to do business, we should not be surprised when the effects show up in higher prices, lower investment and fewer opportunities.

The goal must be balance. Because whilst nobody wants a race to the bottom, neither should we sleepwalk into a situation where the Cost of Business ultimately becomes the Close of Business. That would be a cost every Islander would end up paying.