| Actual | Previous | Revised | Consensus | Consensus Range | |
|---|---|---|---|---|---|
| Claimant Count - M/M | 25.9 | 33.1 | 15.3 | ||
| Claimant Count Unemployment Rate | 4.5% | 4.5% | |||
| ILO Unemployment Rate | 4.7% | 4.6% | 4.6% | 4.6% to 4.6% | |
| Average Earnings - Y/Y | 5.0% | 5.3% | 5.4% |
Highlights
The UK labour market payrolled employee numbers are steadily declining, with 135,000 fewer workers between May 2024 and May 2025, and a further provisional drop of 178,000 by June 2025 over the year and 41,000 on the month. This downturn coincides with the 36th consecutive quarterly fall in vacancies, reflecting growing employer hesitancy in hiring or replacing staff.
Despite this contraction, the employment rate has slightly improved to 75.2 percent, while unemployment has risen to 4.7 percent, suggesting a possible lag between job losses and rising joblessness. Meanwhile, economic inactivity has edged down to 21.0 percent, hinting at modest labour market re-engagement.
On pay, annual average earnings grew by 5.0 percent, with real wages also improving, 1.8 percent for regular pay and 1.7 percent for total pay (CPI-adjusted). This reflects ongoing cost-of-living pressures but signals some resilience in income growth. The public sector outpaced the private sector in regular pay growth (5.5 percent vs. 4.9 percent). Nonetheless, rising claimant counts and a sharp fall in recruitment activity suggest underlying fragility.
With 37,000 working days lost to labour disputes in May alone, industrial tensions further complicate the outlook, emphasising the need for cautious optimism amid persistent volatility. This latest update takes the RPI to 4 and the RPI-P to 2, meaning that economic activities are within the consensus of the U economy.
Despite this contraction, the employment rate has slightly improved to 75.2 percent, while unemployment has risen to 4.7 percent, suggesting a possible lag between job losses and rising joblessness. Meanwhile, economic inactivity has edged down to 21.0 percent, hinting at modest labour market re-engagement.
On pay, annual average earnings grew by 5.0 percent, with real wages also improving, 1.8 percent for regular pay and 1.7 percent for total pay (CPI-adjusted). This reflects ongoing cost-of-living pressures but signals some resilience in income growth. The public sector outpaced the private sector in regular pay growth (5.5 percent vs. 4.9 percent). Nonetheless, rising claimant counts and a sharp fall in recruitment activity suggest underlying fragility.
With 37,000 working days lost to labour disputes in May alone, industrial tensions further complicate the outlook, emphasising the need for cautious optimism amid persistent volatility. This latest update takes the RPI to 4 and the RPI-P to 2, meaning that economic activities are within the consensus of the U economy.
Market Consensus Before Announcement
ILO unemployment is expected unchanged at 4.6 percent in June versus 4.6 percent in May.
Definition
The Labour Market Report covers a number of key areas of the jobs market. Unemployment is updated on the basis of two separate surveys: the claimant count, which measures the number of people claiming unemployment-related benefits, and the more reliable but lagging International Labour Organization's (ILO) measure that excludes jobseekers that did any work during the month and covers those people who are both looking and are available for work. Average earnings growth, a key determinant of inflation, is also updated.
Description
The labour market survey gives the most comprehensive report on how many people are looking for jobs, how many have them and what they are getting paid and how many hours they are working. These numbers are the best way to gauge the current state as well as the future direction of the economy.
The survey also provides information on wage trends, and wage inflation is high on the Bank of England's list of enemies. Bank officials constantly monitor this data watching for even the smallest signs of potential inflationary pressures, even when economic conditions are soggy. If inflation is under control, it is easier for the Bank to maintain a more accommodative monetary policy. If inflation is a problem, the Bank is limited in providing economic stimulus - it must stay within range of its mandated inflation target.
By tracking the jobs data, investors can sense the degree of tightness in the job market. If wage inflation threatens, it is a reasonable bet that interest rates will have to rise and bond and stock prices will fall. In contrast, when jobs growth is slow or negative, then interest rates are more likely to decline - boosting bond and stock prices in the process.
The survey also provides information on wage trends, and wage inflation is high on the Bank of England's list of enemies. Bank officials constantly monitor this data watching for even the smallest signs of potential inflationary pressures, even when economic conditions are soggy. If inflation is under control, it is easier for the Bank to maintain a more accommodative monetary policy. If inflation is a problem, the Bank is limited in providing economic stimulus - it must stay within range of its mandated inflation target.
By tracking the jobs data, investors can sense the degree of tightness in the job market. If wage inflation threatens, it is a reasonable bet that interest rates will have to rise and bond and stock prices will fall. In contrast, when jobs growth is slow or negative, then interest rates are more likely to decline - boosting bond and stock prices in the process.
