MNI BRIEF: UK Unemployment Rate Hits 4-1/2 Year High At 4.8%

UK employees' regular average earnings (ex-bonuses) rose 4.7% y/y in the period to August, and total earnings rose 5.0%, the Office for National Statistics said Tuesday, all as the unemployment rate rose to a 4-1/2 year high of 4.8%.

Average regular earnings growth was 4.4% y/y for the private sector and 6.0% for the public sector. “Wage growth slowed in the private sector to its lowest rate in nearly four years, but public sector pay growth increased, reflecting some public sector pay rises being awarded earlier than they were last year," ONS director of economic statistics Liz McKeown said.

Provisional estimates of payrolled employees for September decreased by 100,000 (0.3%) on the year, and by 10,000 on the month, to 30.3 million. Estimates for payrolled employees fell by 93,000 (0.3%) between August 2024 and August 2025 but increased by 10,000 m/m between July and August. The estimated number of vacancies in the UK fell by 9,000 (1.3%) on the quarter, to 717,000, in July to September 2025 --  the 39th consecutive period where vacancy numbers have dropped compared with the previous three months.

All in all, the data was mixed, but showed a continued softening of the labour market, albeit with wages still at an elevated level, but will likley see the Bank of England at least keep the option af a November rate cut on the table.

Source: ONS