UK Unemployment Falls Slightly as โฃwage Growth Plateaus
London, October 14, 2025 – The โUK unemployment rate edged down to 4.2% in the three months to August, according to data โขreleased today by the office for Nationalโฃ Statistics (ONS). This represents โa slight increase of 0.3 percentageโข points from predictions by Bloomberg economists.
The figures are being closely watched by Bank of โคEngland officials amid concerns that sustained wage growth and persistent inflation could create a feedbackโ loop,โ makingโ it more challenging โขto bring price increases under control. The ONS data indicates wageโข growth has stalled,โฃ offering a potential, thoughโข limited, respite โฃfrom inflationary pressures.
Bank of England external member Catherine Mann recently advocated for maintaining “restrictive” interest rates to curb inflation expectations. Her โcomments suggest a push โto hold rates at โfour per cent at the upcomingโค November meeting, a decision โcurrentlyโ describedโ as finely balanced.
Economists anticipate that Governor โขAndrew Bailey’s vote will be โขdecisive, potentially splitting the Monetary Policy Committee between hawks and doves. The August meeting required a second โvote after Alan Taylor initially favoured a 50 basis โคpoint โcut, citing concernsโ about a weakening jobs market and its potential โฃimpact on price growth.
Other policymakers have โhighlighted the risk that elevated wage growth could fuel further inflation and keep expectations high. The ONS is scheduled to release September inflation data next โweek,with forecasts suggesting price growth could reach as high as four per centโค – double the Bank of England’s two per cent โขtarget.