UK: Labour Market OverviewOffice for National Statistics estimates that the number of UK salaried employees in 2025 will decrease by 109,000 after the increase in employer NICs.
The Office for Budget Responsibility’s (OBR) predictions and those of a major bank were both exceeded.
OBR predicted originally that changes in employer NICs could cost 50,000 job losses, but later revised their prediction to reflect a greater impact. Deutsche Bank estimated it would cost 100 000 jobs.
Kate Nicholls is the chairperson of UKHospitality. stated: “Losing 100,000 jobs across the entire economy in one month is far above the worst case scenario predicted by government’s own fiscal monitor, major banks, as well as countless business groups.
The government is able to achieve its goals by adjusting the NICs. In order to create employment in all parts of the UK, for people from every background and age, you will need sectors like hospitality. However, these tax hikes are likely to hit hospitality workers and those who work part-time the hardest.
These shocking figures should make clear to the Government that the changes made to employer NICs have caused more harm than benefit, and they need to be reviewed immediately and reversed.
In October 2024, UK Chancellor Rachel Reeves MP announced that employer’s NICs would increase by 1.2 per cent to 15 per cent from April 2025, and that the threshold at which companies will have to start making contributions will drop from £9,100 to £5,000.
UKHospitality released a new report earlier this week. restructured its leadership team Nicholls was promoted to the position of chair, and Allen Simpson assumed the role as CEO.
Highlights:
• The UK lost 109,000 payrolled jobs in May 2025, far exceeding government and banking forecasts.
• The Office for Budget Responsibility and Deutsche Bank underestimated impact, with actual job loss exceeding both.
• UKHospitality has urged the British government to reverse NIC changes, warning of serious long-term economic consequences.
