The UK’s unemployment rate has climbed to 5 per cent in the three months to September, according to the latest figures from the Office for National Statistics (ONS), signalling a slowdown in the labour market ahead of the upcoming national Budget.
The rate marks the highest level since the period between December 2020 and February 2021, when the country was grappling with the economic effects of the COVID-19 pandemic. The figure also surpassed analysts’ forecasts, which had projected the unemployment rate to stand at 4.9 per cent
Average wage growth slowed slightly, easing to 4.6 per cent in the third quarter compared to 4.7 per cent in the three months to August. Despite this, the Bank of England expects unemployment to remain close to 5 per cent over the next few years as the economy adjusts to slower growth and tighter monetary conditions.
Work and Pensions Secretary Pat McFadden said the government remains focused on boosting employment despite the latest data.
“Over 329,000 more people have moved into work this year already, but today’s figures are exactly why we’re stepping up our plan to get Britain working,” McFadden stated.
Meanwhile, the number of job vacancies across the country remained largely unchanged, with around 723,000 positions available between August and October 2025.
The rise in unemployment comes as policymakers prepare for the November 26 Budget, which is expected to outline further measures to support economic growth and job creation amid signs of a cooling labour market.