The UK labour market is showing early signs of stabilising. Payrolled employment is still easing, but the pace is slowing and vacancies are levelling off.
At a glance
- Unemployment rate: 5%, up 0.3 percentage points on the quarter (Jul–Sep 25) — 1.789 million people
- UK employment rate: 75%, down 0.2 percentage points (Jul–Sep 25)
- Economic inactivity: largely unchanged at 21%
- Earnings growth: 4.6% excluding bonuses (quarter ending Sep 25)
- Inflation (CPI): 3.6% (Oct 2025), down from 3.8% in September
- Bank Rate: 4%
- Job vacancies: 723,000 (Aug–Oct 2025), up 6,000 on the quarter
- New job postings: 754,359 in Oct 25, up 2.1% on September
Data source: Office for National Statistics, Recruitment & Employment Confederation, Change Specialists Ltd.
About these figures. These are the statistics as the Office for National Statistics published them at the time of this report. ONS routinely revises Labour Force Survey estimates afterwards, so today’s figures for the same period may differ slightly. For the latest official figures, see our UK labour market tracker, which is refreshed daily direct from ONS and the Bank of England.
What it means
Demand is still there. An estimated 723,000 vacancies and 754,000 new job postings in October show continued demand for workers, even as unemployment rises.
Inflation is easing but not solved. At 3.6% it is down from summer highs, yet still well above the Bank of England’s 2% target. Businesses face higher costs and recruitment challenges, though stable inflation supports consumer spending.
Flexible resourcing is doing the heavy lifting. Many organisations remain cautious about permanent hires, yet transformation and digital initiatives cannot wait. Interim and contract talent provides the bridge — delivering specialist capability, maintaining momentum and managing risk without long-term cost commitments.
Written by Julian Brown, Practice Director, Change Specialists.