Unemployment Hits Four-Year High as Jobs Market Continues to Stagnate.Official numbers reveal that the UK’s unemployment rate reached a four-year high in the three months leading up to October, climbing to 5.1% from August to October.
The Office for National Statistics (ONS) said that the rate indicates that unemployment is currently at its highest level since the three months leading up to January 2021.
Between October 2024 and October 2025, the number of persons on firm payrolls dropped by 149,000. In October alone, it dropped by 22,000.
The ONS also said that the number of people on payrolls in November 2025 was down 171,000 from the year before and 38,000 (0.1%) from the month before, to 30.3 million.
The numbers also showed that pay growth slowed again, along with a job market that is still stuck.
Average pay, without including incentives, went by 4.6% in the last three months, down from 4.7% a month before. The growth rate for total salary (including bonuses) went down from 4.9% to 4.7%.
Liz McKeown, the ONS head of economic statistics, said, “The overall picture is still one of a weakening labour market.” The number of people on payroll has gone down again, which shows that hiring has slowed down. Companies also told us that there were fewer jobs available in the most recent month.
“This vulnerability is also shown by the fact that the unemployment rate went up although the number of job openings stayed about the same. She went on to say that the drop in payroll numbers and rise in unemployment had been most noticeable among younger age groups.
The ONS also said that labour disputes in the UK cost an anticipated 39,000 working days in October 2025.
Ben Harrison, the head of the Work Foundation think tank at Lancaster University, said that the numbers showed that the UK job market was still losing steam. He cautioned, “Rising unemployment, falling job openings, and slow real wage growth are all bad signs for workers and job seekers as we move towards 2026.”
“Pay growth is slowing down, with real wages only going up by 0.5% as inflation eats away at wage increases.” On average, workers’ actual salaries have only gone up by £142.22 over the course of the year, or £2.73 a week. This means that many people will be feeling the pressure as Christmas gets closer. He went on to say that the government’s efforts to lower the cost of living will be very important in determining whether workers will see real wage rise in 2026.
“Unemployment is at 5.1%, which is the highest level it’s been in over five years. This is an increase of 327,000 over the past year, mostly because more males and young people are out of work.
“There are now 546,000 young people aged 18 to 24 who are out of work. This is the most since 2015 and an increase of 85,000 from the previous quarter.” Harrison stated, “Most worryingly, it seems to be getting harder for these workers to find work.” He was referring to government initiatives to look into teenage unemployment and inactivity.
The Department for Work and Pensions says that Alan Milburn, a former health secretary, will look into why so many 16- to 24-year-olds are out of work and not doing anything. They hope to have an initial report ready by the spring.