Yesterday’s budget announcement brought substantial changes for businesses across the UK, with a key measure being a significant increase in employers’ National Insurance contributions. Targeted to fund essential services, including the NHS, this increase represents a direct rise in the cost of employment. Northern Ireland’s manufacturing sector may feel this impact acutely, particularly in an already challenging economic environment.
Stephen Kelly, CEO of Manufacturing NI, offered a pointed response to the potential consequences of this change: “The rise in employers’ National Insurance contributions is a straight-up tax on jobs here to fund problems in the NHS and other budgets in England,” he noted. “Employers will have to work out how it funds that tax, and that could mean halting plans for jobs growth, reducing planned or potential wage rises, or perhaps speeding up plans for redundancies, particularly in those sectors currently struggling.”
Despite the government’s attempt to mitigate these effects through promised investments and strategies like Made Smarter, Kelly highlighted that these initiatives offer limited reassurance for the NI economy: “The government has tried to soften the damage with promises of industrial strategies and investments in things like Made Smarter, but as these are devolved areas, these have little importance or value to the NI economy.”
As NI manufacturers now consider how best to absorb these increased costs, many face difficult choices in an uncertain future. Limited access to targeted government support only deepens concerns about long-term growth and stability within Northern Ireland’s manufacturing sector.