Author: John Dean

The UK economy is in a period of adaptation. Businesses are navigating evolving markets, technological change and shifting workforce demands, with AI, data and digital transformation reshaping how organisations operate and deliver value.

At a glance

• Unemployment rate: approximately 5.1%, up on the previous quarter
• UK employment rate: 75.1% (Sep–Nov 25)
• Economic inactivity: broadly stable at around 21%
• Earnings growth: 4.5% excluding bonuses (quarter ending Nov 25)
• Inflation (CPI): 3.4% (Dec 2025)
• Bank Rate: 3.75%
• Job vacancies: 734,000 (Oct–Dec 2025)
• New job postings: 573,597 in Dec 25, down 8.2% on the month
• Business investment growth: +1.5% (Q3 2025)

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

Hiring activity. The labour market continues to slow, with employers cutting back on hiring and redundancies increasing.

Skills shortages persist. Specific sectors still cannot find the people they need, so flexible hiring solutions remain key — particularly in healthcare, logistics and IT.

Investment is cautious. Monetary policy stability creates careful investment behaviour, especially in capital-intensive sectors. Business investment peaked in Q1 2025, dipped in Q2 and recovered modestly in Q3.

Organisations that maintain active programme portfolios — combining technology adoption with workforce capability building — are best placed to respond quickly and sustainably.

Written by Julian Brown, Practice Director, Change Specialists.

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.

With planning season in full swing, many organisations are reviewing their 2026 transformation portfolios, budgets and resources. Given the challenging UK economy, aligning investment, capability and priorities matters more than ever.

At a glance

• Unemployment rate: 4.8%, up 0.2 percentage points on the quarter (Jun–Aug 25) — 1.74 million people
• UK employment rate: 75.1%, down 0.2 percentage points (Jun–Aug 25)
• Economic inactivity: largely unchanged at 21.0%
• Earnings growth: 4.7% excluding bonuses (quarter ending Aug 25)
• Inflation (CPI): 3.8% (Aug 2025), against the Bank of England’s 2% target
• Bank Rate: 4%
• Job vacancies: 717,000 (Jul–Sep 2025), down 1.3% on the quarter
• New job postings: 742,967 in Sep 25, up 11.3% on August

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

Hiring is warming up. New job postings rose 11.3% in September as the market picked up after the summer.

The hiring that is happening is targeted. Demand is concentrated in digital, infrastructure and transformation roles, suggesting a shift towards skills-focused workforce strategies rather than broad headcount growth.

Competition for critical skills continues. Organisations are competing for scarce capability while managing operational and financial pressure. Strategic alignment of people and operational plans will be essential to navigate continuing economic uncertainty.

Written by Julian Brown, Practice Director, Change Specialists.

The UK labour market continues to cool. Unemployment has risen to 4.7% and economic inactivity has fallen to 21.1%, suggesting more people are staying in or returning to work.

At a glance

• Unemployment rate: 4.7% (May–Jul 2025) — 1.67 million people
• UK employment rate: 75.2%, up slightly on the quarter (May–Jul 25)
• Economic inactivity: down to 21.1%
• Earnings growth: 4.8% excluding bonuses (quarter ending Jul 25); total pay up 4.7%
• Inflation (CPI): 3.8% (Aug 2025), against the Bank of England’s 2% target
• Bank Rate: 4%
• Job vacancies: 728,000 (Jun–Aug 2025), down 1.4% on the quarter
• New job postings: 661,639 in Aug 25, down 3.8% on July

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

The cooling trend continues. Payrolled employees fell further, unemployment rose and vacancies declined again, particularly in larger businesses. Total weekly hours increased, reflecting heavier workloads for those in work.

The signals are mixed, not uniformly negative. The employment rate edged up and nominal wage growth remains strong, even as structural pressures point to a softer market.

What it means for you. Employers benefit from increased candidate availability. Work seekers need to sharpen skills and adaptability to stay competitive. As decision-makers return after the summer, expect restrained hiring and wage strategies — with some organisations already shifting towards contract and interim resource.

Slower GDP growth and cautious business investment point to a measured pace. It matters that these figures do not dampen innovation or digital transformation.

Written by Julian Brown, Practice Director, Change Specialists.

Employer confidence continues to soften, but the pace of decline in job vacancies has slowed — the weakest rate of vacancy contraction since September 2024.

At a glance

• Unemployment rate: 4.6% (February to April 2025)
• Job vacancies: 736,000 (March to May 2025), down 63,000 on the quarter and 59,000 below January–March 2020 levels
• Payrolled employees: 30.2 million — early May estimates down 109,000 on the month and 274,000 on the year
• Average total pay growth: 5.3% including bonuses (Feb–Apr 2025)
• Pay growth in real terms: up 1.5% (Feb–Apr 2025)
• Claimant count: 1.735 million (May 2025)

Data source: Office for National Statistics, Recruitment & Employment Confederation, Change Specialists Ltd — June 2025.

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

We may be approaching a turning point in the labour market’s downturn, potentially for contract work — though caution remains.

Many organisations are still not replacing leavers in order to manage costs, which points to ongoing uncertainty in workforce planning.

The labour market closely tracks the broader economy, and these figures reflect the continued impact of tough winter months and ongoing inflationary pressure.

Written by Julian Brown, Practice Director, Change Specialists.