More than 80,000 hospitality jobs lost since announcement of National Insurance rise

The number of people working in UK hospitality has dropped by more than 100,000 in the past year as the sector bears the brunt of increases to employers’ National Insurance Contributions (NICs).

UKHospitality said there had been a major fall in the availability of entry-level roles and summer jobs typically taken up by young people.

The number of payrolled employees in hospitality dropped 108,000 in the year to July 2025, the largest decrease of any sector of the economy, according to analysis from the Office for National Statistics (ONS).

Some 84,000 of these roles have been lost since changes to employer NICs were announced in Rachel Reeves’ inaugural budget last autumn, UKHospitality said.

Restaurant owners told The Caterer they have scrapped plans for new openings, cut staffing levels and asked chefs to pitch in with service in a bid to cover the increase, which is expected to cost hospitality £3.4b a year.

Job vacancies in the sector also dropped 7,000 in the three months to July as operators cut back on hiring after the tax changes came into force in April.

The ONS said feedback from its survey suggested some firms may not be recruiting new staff or replacing those who have left.

Job postings for work during the summer in hospitality are down 25% year-on-year according to data from the Recruitment and Employment Confederation (REC).

Kate Nicholls, chair of UKHospitality, said: “The biggest fall in employment is among younger workers, those seeking their first roles, in entry level jobs or holiday jobs – a group that is now losing out on opportunities to gain vital experience and essential skills. The hospitality sector is a key provider of these valuable roles yet, since the announcement of the changes to employer NICs – which are set to cost the sector £3.4b per year – 84,000 jobs have been lost in the sector.

“Hospitality businesses are being taxed out by rising costs and policy decisions that make it harder for businesses to hire and invest. If the government is serious about supporting growth and tackling youth unemployment, it must urgently rethink the pressure it’s placing on hospitality businesses.”

The overall number of payrolled employees in the UK fell by 149,000 in the year to June 2025, a decrease of 4.9%.