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Leicester & Leicestershire firms reel from “NICs pinch”—66% see shrinking profit margins

ended 04. September 2025

New figures from the Bank of England’s August Monthly Decision Maker Panel survey reveal the impact of the April 2025 hike in employer National Insurance contributions is being felt acutely across the UK—but particularly in Leicester and Leicestershire.

66% of firms reported lowering profit margins

34% raised prices to cope with rising costs

46% reduced employment levels

20% cut wages below what they would typically pay
 

Source:  https://www.bankofengland.co.uk/decision-maker-panel/2025/august-2025

These figures underscore a growing strain: local businesses are being forced to tighten belts across multiple fronts just to weather the increased NICs burden.

What We Want to Hear from Local Business Leaders

We’re inviting urgent comment from employers across Leicester and Leicestershire:

How has the rise in employer NICs reshaped your cost structure or staffing decisions?

Which margin of adjustment—profits, prices, jobs, or wages—has hit you hardest?

What support or policy changes would help you continue investing and hiring locally?

1 responses from the Newspage community

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Editor
Scott Gallacher
Director at Rowley Turton
Like many Leicester businesses we’re feeling the squeeze from the National Insurance hike. We’re not passing costs onto clients, but instead focusing on working smarter to do more with our current team. At the same time, we’ve hired a practice manager and plan to take on an apprentice — to improve systems and processes, not simply add headcount or costs. For firms like ours, the future is about delivering the best possible service to clients without raising fees.