The unemployment rate increased to 5.2 per cent in the three months to December, compared with 5.1 per cent in the period to November, according to the Office for National Statistics (ONS).
The figures released on Tuesday will come as a blow to Chancellor Rachel Reeves, who has pledged to improve opportunity and rebuild the economy.
It’s the highest level of unemployment the UK has seen since January 2021, with the number of pay-rolled employees in the UK falling by 121,000 (0.4 per cent) last year.
This latest release is the latest sign that the jobs market is continuing to deteriorate.
The dismal figures follow Britain’s youth unemployment overtaking the EU
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PA
UK regular pay growth slowed to 4.2 per cent in the three months to December, and rose by 0.8 per cent in real terms after accounting for CPI inflation.
Reacting to the figures, ONS Director of Economic Statistics Liz McKeown said: “The number of workers on payroll fell further in the final quarter of the year, reflecting weak hiring activity, although it is largely unchanged in the latest month.
“Over the same period the unemployment rate increased, with data showing that more people who were out of work are now actively looking for a job.
“The number of vacancies has remained broadly stable since the middle of last year. Alongside rising unemployment this means that the number of unemployed people per vacancy has increased, reaching a new post-pandemic high.
“Meanwhile, redundancies are also showing an upward trend.
“Private sector wage growth continues to slow and is at its lowest rate in five years.
“Public sector pay growth also slowed in the latest period but remains elevated, still affected by some pay awards being implemented earlier in 2025 than 2024, although this effect has now started to diminish.”
The release follows confirmation last week that a sharp rise in joblessness among young people had pushed the UK above the youth unemployment rate of the European Union.
It’s the first time that it’s happened in a quarter of a century.
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