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GB: Labour Market Report
| Consensus | Consensus Range | Actual | Previous | Revised | |
| Claimant Count - M/M | -11.0 | 6.7 | -6.4 | ||
| Claimant Count Unemployment Rate | 4.3% | 4.4% | |||
| ILO Unemployment Rate | 4.9% | 4.7% to 4.9% | 4.9% | 4.9% | |
| Average Earnings - Y/Y | 4.1% | 4.3% | 4.4% |
Highlights
The UK labour market showed further signs of gradual cooling in mid-2026, characterised by weakening payroll employment, subdued recruitment and modestly higher unemployment. Payrolled employment fell by 78,000 (0.3 percent) year-over-year in June, while July estimates indicate a larger annual decline of 94,000 (0.3 percent), leaving payroll employment at 30.3 million. Consistent with this moderation, the unemployment rate increased by 0.2 percentage points annually to 4.9 percent, although the employment rate remained relatively resilient at 75.1 percent.
Hiring appetite also remained weak. Vacancies declined to 707,000 (0.8 percent) in May–July, their lowest comparable level outside the pandemic period since 2014. Rising labour and operating costs appear to be constraining recruitment, particularly among smaller businesses. Nevertheless, the fall in the Claimant Count to 1.665 million provides some counterbalance to the softer employment indicators.
Wage pressures are also moderating. Regular earnings grew by 3.5 percent while total earnings grew by 4.1 percent. But substantial public–private divergence persisted, at 6.1 percent and 2.8 percent, respectively. Crucially, real regular earnings increased by only 0.5 percent on a CPIH basis for regular and 1.1 percent for total earnings between April and June. In summary, the evidence points to a cooling labour market, with weaker labour demand increasingly constraining employment and nominal wage momentum. These updates take the RPI to 27 and the RPI-P to 35, meaning that economic activities continue to outpace market expectations in the UK.
Market Consensus Before Announcement
The jobless rate is expected unchanged at 4.9 percent in July.
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 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.