The latest Office for National Statistics (ONS) report shows that the increase to employer’s National Insurance Contributions (NICs) has led to a further rise in unemployment, say leading audit, tax and business advisory firm, Blick Rothenberg.
Robert Salter, a director at the firm, said, “The latest employment statistics from ONS show a further increase in the number of people out of work, with 4.7% of people now registered as unemployed, an increase from 4.4% in January 2025.
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“This increase in joblessness was almost inevitable following Rachel Reeves decision to increase employer’s NICs to 15% from April 2025.
“However, while the rate of people who are unemployed has increased, the Chancellor will likely focus on the fact that overall employment figures remain strong.
“The increase in official unemployment is partly countered by the fact that the absolute number of people in employment has increased slightly, as individuals who had perhaps retired or otherwise ‘opted out’ of the labour market after Covid have returned to work.”
Inflation is likely set to increase in the coming months and this will put more “pressure” on the Chancellor and inevitably the Cabinet.
Robert added, “But while there are glimmers of hope in these statistics for the Government, the rate of unemployment has become higher and is likely to increase further.
“On top of this, inflation is expected to increase to 3.7% in the coming months. Meaning the pressure on Rachel Reeves will also be growing.”
