UK Labour Market Shows Signs of Cooling: Job Numbers Dip
The UK’s labor market is experiencing a slowdown, with employment figures showing a decline. The latest data reveals a decrease in payrolled employees, alongside a rise in unemployment. These shifts may indicate a broader economic adjustment underway.
Job Market Contraction
Between March and April 2025, the UK saw a decrease of 55,000 payrolled employees, approximately 0.2%. Over the year, from April 2024 to April 2025, the number of payrolled employees fell by 115,000, equivalent to a 0.4% reduction. Early estimates for May 2025 further show a monthly decrease of 109,000, or 0.4%. These figures are subject to revision.
The UK employment rate for those aged 16 to 64 years was estimated at 75.1% during February to April 2025. The unemployment rate for those aged 16 and over was estimated at 4.6% during the same period. The number of job vacancies fell by 63,000 on the quarter to 736,000 from March to May 2025.
Earnings and Disputes
Average regular earnings growth, excluding bonuses, was 5.2% annually between February and April 2025 across Great Britain. Total earnings, encompassing bonuses, grew by 5.3% year-over-year. During April 2025, approximately 47,000 working days were lost to labor disputes throughout the UK.
The latest UK labour market data is now available: https://t.co/m5Hk1Yp29c
➡️ The number of payrolled employees decreased on the month and year
➡️ The employment rate increased on the quarter
➡️ The unemployment rate increased on the quarter
➡️ Vacancies continued to fallJune 10, 2025
Data Considerations
Different data sources provide varying insights. The Labour Force Survey (LFS) surveys households, while Workforce Jobs (WFJ) is based on business surveys. HM Revenue and Customs (HMRC) Pay As You Earn (PAYE) data comes from administrative tax records. Each source has its own strengths and limitations.
“Each of these three sources are collected and processed in different ways, so we do expect differences in levels (for example, jobs versus people, differing reference periods). It is not unusual to see divergences in our indicators for more than one period.”
—Office for National Statistics
The number of vacancies has been falling. Feedback suggests firms might not be recruiting or replacing workers. According to recent research from the Bank of England, the UK’s labor market participation rate is expected to remain below pre-pandemic levels, potentially impacting long-term growth. (Bank of England, 2024)
Official Statistics
The Office for Statistics Regulation (OSR) introduced the new accredited official statistics badge on June 7, 2024. This badge denotes official statistics that have been independently reviewed by the OSR. Several labour market outputs are accredited official statistics, and some are official statistics in development.
The UK labor market data shows a trend of reduced employment and a higher unemployment rate, along with a drop in job vacancies. These combined factors indicate a complex economic landscape requiring careful monitoring and analysis in the coming months.
