In the quarter to April 2026, employment and inactivity levels rose, unemployment fell, vacancies continued to decline, and regular wage growth in the private sector slowed to its lowest level in over five years. Youth unemployment also remained concerningly high.
Therefore, cooling labour market conditions have persisted. While it is encouraging that headline unemployment has fallen, rising inactivity levels suggest many people have not moved into work, and labour market participation – and business hiring caution – remains a key challenge.
The UK employment rate (for people aged 16 to 64 years old) was estimated at 75.0% in the period between February 2026 and April 2026, which is unchanged on the quarter and the year. The UK unemployment rate (for people aged 16 and over) was estimated at 4.9% in the quarter to April 2026, representing a fall on the quarter but a rise on the year.
The inactivity rate for people aged 16 to 64 years old was estimated at 21.0% in the three months to April 2026, which is up on the quarter but down on the year. There were an estimated 707,000 vacancies in the quarter to May 2026, representing a decrease on the quarter (-19,000) and the year (-31,000).
Estimates for payrolled employees in the UK fell by 138,000 (-0.5%) between April 2025 and April 2026, and decreased by 53,000 (-0.2%) between March and April 2026. When looking at February to April 2026, the period comparable with Labour Force Survey (LFS) estimates, the number of payrolled employees fell by 103,000 (-0.3%) over the year and by 31,000 (-0.1%) over the quarter. The early estimate of payrolled employees for May 2026 decreased by 119,000 (-0.4%) on the year, but was largely unchanged on the month, increasing by just 2,000 (0.0%) to 30.3 million. Figures for May should be treated as provisional and are likely to be revised when more data is received next month.
Annual growth in employees' average regular earnings (excluding bonuses) in Great Britain was 3.4% in the three months to April 2026, and annual growth in total earnings (including bonuses) was 4.4%. 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 0.1% and 1.2%, respectively, across the same period.
The ongoing ‘low hire, low fire’ labour market dynamics were reinforced in this month’s UK labour market data. And the youth unemployment rate highlights that these conditions continue to have a disproportionately large impact on young people, who are more likely to be outside of the workforce.
Driving sustainable economic growth remains key to raising living standards and supporting more people to enjoy the benefits of work. Moreover, there are various ways in which government can support businesses to grow. This includes ensuring that key decisions relating to the Employment Rights Act’s secondary regulations are reached through tripartite discussion.