The unemployment rate in the United Kingdom has risen to 5 per cent in the three months to September, reaching the highest level in the past four years, official figures show.
According to the data released by the Office for National Statistics (ONS), the figure was higher than expected as it was projected to be 4.9 per cent by several analysts ahead of the Budget on 26 November. In the previous quarter, the unemployment rate was 4.8 per cent.
Among other figures released by the ONS, the average wage growth was 4.6 per cent in the third quarter, which was down by 0.1 per cent compared to 4.6 per cent in the third quarter.
The surge in unemployment rate in the United Kingdom has fueled the speculations that the Bank of England’s Monetary Policy Committee may decide to cut the repo rates when it meets on 18 December.
While releasing the official figures, the ONS has cited caution and added that they are working on the steps to address concerns about the quality of the data.
What does the data mean?
Based on the latest figures, it can be seen that about 1.7 million people are claiming unemployment benefits. If taking out the skewed levels seen during the Covid-19 years, the latest data was the highest seen since August 2016.
Among other stats, the ONS data also showed a difference between public and private sector wage growth. It said that public sector wage growth was up by 6.6 per cent, compared to the private sector’s 4.2 per cent.
Between August and October 2025, the job vacancies saw a rise by 2,000 to 723,000, which was the first increase in more than three years. However, they were way below the peak of 1.3 million recorded from March to May 2022.
Experts worry
According to the director of economic statistics for the ONS, Liz McKeown, the figures point to a weakening labour market. However, McKeown opined that the number of job vacancies would continue to remain unchanged despite the high unemployment rate.
Work and Pension Secretary, Pat McFadden, was hopeful that the British economy was still generating jobs, but he did agree on the challenges in the labour market. He also expressed his concern about the number of young people not in employment over the past five years.
Meanwhile, pensions secretary Helen Whately blamed increased unemployment on government policies. Whately said that high taxes on jobs and red tape on businesses are the primary reasons for the increased unemployment rate.
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