Employers' Contributions
The question
To ask the Chancellor of the Exchequer, whether her Department has undertaken modelling of the potential impact of changes to employer National Insurance contributions on the level of employment opportunities for people aged between 18 and 24.
Answered by Dan Tomlinson
Businesses are able to claim employer NICs reliefs including those for under-21s and under-25 apprentices. This means employers pay no employer NICs for apprentices under 25 or employees under 21 on earnings up to £50,270. These reliefs are estimated to have been worth around £2.5 billion in 2025/26.
In their October 2024 Economic and Fiscal Outlook, the Office for Budget Responsibility (OBR) estimated the impact that the increase in employer NICs would have on labour supply. In their latest forecast (taking into account all government policies expected to have a significant impact), the OBR expect that employment levels will rise in every year of the forecast, reaching 35.3m in 2030-31.
The OBR have not estimated a breakdown by age.
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