In the quarter to November 2025, unemployment and redundancy levels rose, the employment rate held, and strong private sector wage growth has continued to show signs of easing. The number of vacancies across the economy was also broadly unchanged and inactivity remains stubbornly high. Therefore, the UK labour market picture is fundamentally the same, with cooling conditions increasingly being driven by business cost pressures.
The UK employment rate (for people aged 16 to 64 years old) was estimated at 75.1% in the period between September 2025 and November 2025, which is unchanged on the quarter but slightly up on the year. The UK unemployment rate (for people aged 16 and over) was estimated at 5.1% in the three months to November 2025, representing an increase on the quarter and the year.
The inactivity rate for people aged 16 to 64 years old was estimated at 20.8% in the three months to November 2025, which is slightly down on the quarter and to a greater extent, the year. The provisional estimate for the number of vacancies in the UK economy in the three months to December 2025 is 734,000, representing a slight increase on the quarter (+10,000) and fall on the year (-69,000).
Estimates for payrolled employees based on administrative data from HMRC in the UK fell by 155,000 (-0.5%) between November 2024 and November 2025, and decreased by 33,000 (-0.1%) between October 2025 and November 2025. The early estimate of payrolled employees for December 2025 decreased by 184,000 (-0.6%) on the year, and by 43,000 (-0.1%) on the month, to 30.2 million. The December 2025 estimate should be treated as provisional and is likely to be revised when more data is received next month.
Annual growth in employees' average regular earnings (excluding bonuses) in Great Britain was 4.5% in the three months to November 2025, and annual growth in total earnings (including bonuses) was 4.7%. Annual growth in real terms (adjusted for inflation using the Consumer Prices Index including owner occupiers' housing costs (CPIH)), for regular pay and total pay stood at 0.6% and 0.8%, respectively, across the same period.
This month’s release highlights that recent labour market trends continued into the Autumn Budget. Private sector wage growth remained strong but fell for the ninth consecutive month, highlighting how rising business costs and stagnant productivity are continuing to limit the salary increases that firms can afford. Creeping unemployment and redundancy levels and plateauing vacancies also indicate ongoing barriers to job creation and job security.
The recent unfair dismissal amendment to the Employment Rights Act (ERA) is a clear example of how tripartite discussions can support meaningful (labour market) policy change. It is important that this approach to policymaking continues moving forward. In the short to medium-term, it is also critical that government works with businesses to tackle rising pressures on firms’ cost base. Failure to do so will ultimately prevent businesses from being able to protect jobs, raise productivity and grow.
