As of August 2025, we’ve reviewed the latest labour market data for the UK, covering the period from April 2025 to June 2025. This report from the Office for National Statistics (ONS) sheds light on several important indicators, including trends in payrolled employees, employment, unemployment, economic inactivity, vacancies, earnings, and labour disputes. Understanding these trends is crucial for us as a business, as they help us make informed decisions about workforce planning, compensation strategies, and recruitment priorities. By staying updated on these key figures, we can better anticipate changes in the labour market and respond effectively.

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Key Findings

Payrolled Employees

Estimates of UK payrolled employees fell by 26,000 (0.1%) between May 2025 and June 2025. It also fell by 149,000 (0.5%) between June 2024 and June 2025.

The total number of payrolled employees in the UK decreased by 66,000 (0.2%) over the quarter and fell by 110,000 (0.4%) over the year, looking at April to June 2025.

The early estimate for July 2025 showed a decrease of 8,000 (0.0%) on the month, and a decrease of 164,000 (0.5%) on the year to 30.3 million.

Employment and Unemployment

The UK employment rate for people aged 16 to 64 years stood at 75.3% for April to June 2025. This is above estimates of a year ago, and up in the latest quarter.

The unemployment rate for those aged 16 and over was estimated at 4.7% in April to June 2025, above estimates of a year ago and up on the quarter.

The economic inactivity rate, which refers to individuals aged 16 to 64 not in work or actively seeking work, was 21%, showing a decrease compared to both last year and the previous quarter.

Vacancies and Claimant Count

Job vacancies in the UK from May to July 2025 were estimated at 718,000, showing a fall of 44,000 on the quarter. This marked the 37th consecutive quarterly decline, seeing quarterly falls in 16 of the 18 industry sectors.

The Claimant Count, which tracks the number of people claiming unemployment benefits, rose to 1.695 million, showing a decrease both month-on-month and year-on-year.

Earnings Growth

Annual growth in employees’ average regular earnings for regular earnings (excluding bonuses) was 5%, and total earnings (including bonuses) was 4.6% in April to June 2025.

When adjusted for inflation, regular pay was 1.5% and total pay was 1.1% in April to June 2025, based on the Consumer Prices Index including owner occupiers’ housing costs (CPIH)

Labour Disputes

Labour disputes resulted in an estimated 38,000 working days lost in June 2025.

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The UK labour market is cooling. Employment rose to 75.3% and inactivity fell to 21%, but payrolled employees dropped by 66,000 over the quarter and 110,000 over the year, with unemployment up to 4.7%. Vacancies fell for the 37th consecutive quarter to 718,000, while the Claimant Count decreased to 1.695 million.

Earnings grew by 5.0% (regular pay) and 4.6% (total pay), outpacing inflation, but 38,000 working days were lost to disputes in June 2025. These trends point to a slower hiring market, making flexible workforce planning essential.

Source: Labour market overview, UK – Office for National Statistics