Employment rate in the UK 2000-2025

In May 2025, the employment rate in the United Kingdom was 75.2 percent, up from 75.1 percent in the previous month. After almost dropping below 70 percent in 2011, the employment rate in the United Kingdom started to climb at a relatively fast pace, peaking in early 2020. Due to the onset of the COVID-19 pandemic, however, employment declined to 74.6 percent by January 2021. Although not quite at pre-pandemic levels, the employment rate has since recovered. 

Labor market trouble in 2025?

Although unemployment in the UK spiked at 5.3 percent in the aftermath of the COVID-19 pandemic, it fell throughout most of 2022, to just 3.6 percent in August 2022. Around that time, the number of job vacancies in the UK was also at quite high levels, reaching a peak of 1.3 million by May 2022. The strong labor market put employees in quite a strong position, perhaps encouraging the high number of resignations that took place around that time. Since 2023, however, the previously hot labor market has cooled, with unemployment reaching 4.6 percent in April 2025 and job vacancies falling to a four-year low of 736,000 in May 2025. Furthermore, the number of employees on UK payrolls has fallen by 227,500 in the first five months of the year, indicating that 2025 will be a tough one for the labor market.

Headline economic measures revised in early 2025

Along with the unemployment rate, the UK's inflation rate is also expected to be higher than initially thought in 2025, reaching a rate of 3.2 percent for the year. The economy will also grow at a slower pace of one percent rather than the initial prediction of two percent. Though these negative trends are not expected to continue in the long term, the current government has already expended significant political capital on unpopular decisions, such as the cutting of Winter Fuel Payments to pensioners in 2024. As of June 2025, they are almost as unpopular as the previous government, with a net approval rating of -52 percent.