Unemployment in the UK increased to 5.1 per cent in the three months to October 2025, up from five per cent in September, according to the latest Office for National Statistics (ONS) figures.
While these figures come before Chancellor Rachel Reeves delivered her Budget on November 26, they come as another blow to the Treasury as the Labour Government attempts to bolster the economy.
Today’s ONS unemployment rate figures for October are the highest since the first quarter of 2021, and if the Covid-19 pandemic era is not taking into account, the highest since 2016.
As well as this, UK average regular earnings growth slipped to 4.6 per cent in the three months to October and was 0.9 per cent higher factoring in the consumer prices index CPI inflation.
Rachel Reeves has sought to bolster economic growth | GETTY
Notably, Britain’s economic inactivity rate for people aged 16 to 64 years was projected to be 21 per cent in August to October 2025, which is lower than in the latest quarter and under estimates of a year ago.
Furthermore, the UK Claimant Count for November 2025, which measures how many people receive out-of-work benefits, jumped on the month but decreased on the year to an estimated 1.683 million.
The latest ONS figures estimate the number of employees on payrolls fell by around 38,000 during November to 30.3 million in further sign of a weakened jobs market in the UK.
Analysts note younger workers are currently struggling to navigate the job market with some blaming the Chancellor’s decision to raise the National Living Wage and National Insurance contributions for employers; which has resulted in businesses not advertising jobs as much.
The latest unemployment figures are a blow to the Chancellor
|
GETTY / ONS
Liz McKeown, ONS director of economic statistics, said: “The overall picture continues to be of a weakening labour market. The number of employees on payroll has fallen again, reflecting subdued hiring activity, while firms told us there were fewer jobs in the latest period.
“This weakness is also reflected in an increase in the unemployment rate while vacancies remained broadly flat. The fall in payroll numbers and increase in unemployment has been seen particularly among some younger age groups.”
THIS IS A BREAKING NEWS STORY…MORE TO FOLLOW
LATEST DEVELOPMENTS