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Are you ditching full-time for contractors (or seeing it)?

ended 06. August 2025

The number of contractor jobs being advertised is up by 22% since April, while the number of ,permament roles is down by 9%, according to research by Adzuna shared with Bloomberg. Businesses, in effect, are mitigating the impact of increased Employers' NI by taking on flexible staff instead. Was this always on the cards? Are you seeing evidence of it? And are there any unintended consequences of Labour's NI hike? For example, could the drop in the number of full-time roles cause more people to set up a business themselves, which could create a more entrepreneurial economy? Many businesses, after all, are set up out of necessity rather than choice, when the perceived risk factor is taken away.

2 responses from the Newspage community

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Editor
Tony Redondo
Founder at Cosmos Currency Exchange
Following the budget, this was always on the cards. The 22% rise in contractor jobs and 9% drop in permanent roles since April reflects businesses mitigating the 2024 UK Budget’s Employers’ NICs hike and minimum wage rise. This was predictable, as firms often shift to flexible labour when labour costs rise. While this could spur necessity-driven entrepreneurship, it may also lead to job insecurity, wage suppression, and sectoral strain, particularly among SMEs and the hospitality sector, especially in areas like Cornwall, where the local economy is driven by tourism. The long-term impact on the entrepreneurial economy depends on whether these new businesses can scale or if they remain survivalist, constrained by economic pressures and limited support.
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Kundan Bhaduri
Entrepreneur, Investor and Landlord at The Kushman Group
On my development sites across Kent, the balance sheet makes the decision for me. I can hire another permanent staff and pay the Treasury a significant premium for the privilege, or I can engage an experienced contractor for a fixed term. The Chancellor has not just incentivised the latter, she has made it a matter of commercial survival.

The notion that higher NIs will birth a new generation of dynamic entrepreneurs is a dangerously romantic fantasy. What we are actually creating is a nation of reluctant freelancers, stripped of sick pay, holiday entitlement, and pension contributions, operating in a state of perpetual economic anxiety. This is basically the gig economy expanding by government decree. The new army of the self-employed will soon discover that while escaping the payroll is simple, when buying their first home, convincing a mortgage underwriter that your income is stable is a far greater challenge. The Treasury and the Chancellor have made that lifestyle choice for you.