Almost 55,000 more people are out of work this month due to National Insurance Contribution rise

Less jobs available and more people out of work

Almost 55,000 more people are out of work this month due to the increase in National Insurance Contributions (NIC), say leading audit, tax and business advisory firm, Blick Rothenberg.

Robert Salter, a Director at the firm, said: “The increase in employers NIC has caused UK unemployment to rise. The latest figures from the Office of National Statistics (ONS) show that from the year to April 2025 there has been a rise of almost 55,000 in the absolute number of people out of work and seeking employment between March and April 2025, and the rate of unemployment as a percentage has increased to 4.6%.”

He added: “This is because employers are responding to increased NIC costs by reducing recruitment levels, off-shoring or investing in automation to minimize staffing expenses. This means less jobs are available for those seeking work, increasing the unemployment rate.”

Robert said: “Hopefully some of the plans that the Government has announced, such as the increase in transport infrastructure spending, may minimize the impact of higher NIC costs on the wider labour market. Especially as some businesses are passing higher costs on to consumers by increasing their prices.”

He added: “However, the increase in unemployment cannot be solely linked to the increase in employer’s NIC, as broader factors such as the general weakness in the world economy and US President Donald Trump’s tariff wars have had an impact on UK businesses. But the increase in NIC charges for employers is compounding these other economic factors and driving up the UK’s joblessness rate.”