Employment Slips Again, but Signs of Stability Emerging
The UK labour market saw another modest contraction in September 2025, with payrolled employees falling by 117,000 (0.4%) year-on-year and 32,000 (0.1%) month-on-month.
When comparing July to September 2025 — the period aligned with the Labour Force Survey (LFS) — the total number of payrolled employees dropped by 109,000 (0.4%) over the year and 26,000 (0.1%) over the quarter.
Early estimates for October 2025 suggest a further decline of 180,000 (0.6%) year-on-year, bringing total payrolled employment to 30.3 million. However, these figures remain provisional and may be revised as more data are collected.
Recruitment Confidence Flat as Vacancies Plateau
After 39 consecutive quarterly declines, the UK vacancy count showed early signs of stabilisation. The number of vacancies rose slightly by 2,000 (0.2%) to 723,000 in the three months to October — a potential turning point for recruiters after more than two years of contraction.
Still, many employers remain cautious about expanding their workforce, with feedback suggesting businesses are holding off on replacements rather than launching new recruitment campaigns.
Unemployment Rises, Creating a Deeper Candidate Pool
The employment rate for those aged 16 to 64 years fell slightly to 75.0%, while unemployment rose to 5.0% — the highest in over a year. This suggests a widening talent pool, which could ease long-standing skills shortages in some sectors.
Meanwhile, the economic inactivity rate remained steady at 21.0%, continuing its gradual improvement compared to last year.
Pay Growth Slows but Real Wages Remain Positive
Wage growth cooled slightly, with regular pay up 4.6% and total earnings up 4.8%. Real pay, adjusted for inflation, grew 0.5% for regular earnings and 0.7% for total pay, reflecting modest but positive gains for employees.
Public sector pay rose sharply by 6.6%, partly due to early pay settlements, while private sector growth slowed to 4.2%. Recruiters in public services may see stronger hiring activity, supported by these pay adjustments.
Recruiter Outlook — A Winter Hiring Reset Ahead
Despite subdued employment figures, vacancy stabilisation and a growing candidate pool offer reasons for cautious optimism. Recruiters should prepare for sector-specific rebounds — particularly in public services, logistics, and seasonal retail — as the year draws to a close.
Vacancies and jobs in the UK: October 2025
- Vacancy numbers are broadly unchanged on the quarter; early estimates suggest a small increase of just 2,000 (0.2%) vacancies to 723,000 in August to October 2025.
- Vacancies estimates increased on the quarter in half of the 18 industry sectors in August to October 2025, with the largest increase in the professional scientific and technical activities sector, and in the education sector.
- Total estimated vacancies were down by 99,000 (12.0%) in August to October 2025 from the level of a year ago, decreasing in 16 of the 18 industry sectors.
- The number of unemployed people per vacancy was 2.5 in July to September 2025, up from 2.3 in the previous quarter; this is the highest level (excluding the pandemic) since May to July 2015.
Office for National Statistics (ONS), released 11 November 2025, ONS website, statistical bulletin, Labour market overview, UK: November 2025
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