Employers bracing themselves for cost hikes says chamber

East Midlands Chamber has said that the impending increase in employer National Insurance contributions could change hiring plans and lead to raised prices.

The renewed warning from the chamber follows new findings published by the British Chambers of Commerce and professional services firm AAB that revealed six out of 10 businesses expect recruitment to be affected.

And in the same survey, more than half expect prices to be impacted.

Overall, the research revealed eight out 10 businesses expect to be impacted when the new cost takes effect from April.

Scott Knowles, chief executive at East Midlands Chamber, said: “When firms have faced incredibly challenging conditions for such a prolonged period, higher National Insurance contributions from 1 April 2025, combined with a lower threshold at which payments begin is not going to be easy and businesses are going to have to make difficult decisions.

“The picture we’re seeing in the national data from the British Chambers of Commerce largely parallels the findings of our Quarterly Economic Survey for the East Midlands, which found the same number of businesses – just over half – anticipate having to put up prices, while the East Midlands saw the number of businesses expecting to revise their recruitment plans double from the previous quarter to 22%.

“With growth being the goal the Government talks of most frequently, raising the staffing cost of businesses is going to make any growth that much harder to achieve, while rising inflation on top of higher NI contributions will only push up price pressure.

“Ahead of this year’s comprehensive spending review, political leaders need to ensure they are listening to what firms are saying, that measures announced in the review are supportive of businesses and enable growth.”