http://news.bbc.co.uk/1/hi/uk_politics/8602988.stm

This is an annoying debate from both sides. Firstly, a rise in employer national insurance contributions will likely lead to fewer jobs than a world where this did not happen. The economics is pretty simple to anyone familiar with a downward sloping demand curve. Any evidence based on past experiences of the form "last time NI went up, employment also went up" is nonsense, because we don't see the counterfactual: a world where NI didn't go up. Probably, in that world, employment went up even more.

I say probably in all of this because firm decision making tends to be lumpy, rather than marginal. I'm not convinced a large firm can distinguish expected profits from creating 18 new jobs and creating 22 new jobs, for example, especially in service and retail companies (which is where many of the Telegraph writers came from). I'm positive that actual research on this would yield mixed results across different firms.

All this said, there is a deficit to correct, and that money needs to come from somewhere. I'd rather Darling came out and made the argument that as we expect the economy to grow and employment to start to expand, we are raising NI contributions from employers as a way of raising extra revenue by sharing in the returns to this growth. After all, the government's deficit is partially the result of the support it gave to employers during the recession (including the giveaway to business that was the 15% VAT rate). That seems fair to me, certainly moreso that many other sources of tax income.