The UK labour market is showing increasing signs of strain after new official figures revealed that the unemployment rate has risen to 5.1%, its highest level in almost five years, with young people bearing the brunt of the slowdown. Data released by the Office for National Statistics shows that joblessness increased in the three months to October as businesses cut back on hiring amid economic uncertainty, high interest rates and rising operating costs.
Young workers have been particularly affected by the deteriorating conditions, with a sharp rise in unemployment among people aged 16 to 24. Analysts say entry-level and temporary roles, which are often taken up by younger workers, have been hardest hit as employers become more cautious. Many young people are struggling to find their first job or secure stable employment, raising concerns about long-term scarring effects on careers and earnings.
The figures also point to a cooling jobs market more broadly, with payroll employment falling for a second consecutive period and wage growth slowing compared with earlier in the year. While pay is still rising faster than inflation, the pace has eased, reducing some of the pressure on employers but also limiting income growth for workers. Economists suggest the combination of rising unemployment and slowing wages could strengthen the case for interest rate cuts by the Bank of England in the coming months.
Government officials have acknowledged the challenges highlighted by the data, particularly for young people trying to enter the workforce, and have pointed to ongoing reviews and employment programmes aimed at improving skills and job opportunities. Business groups, meanwhile, are calling for targeted support to help firms create more entry-level roles and apprenticeships. With economic growth remaining weak, experts warn that without focused action, young workers could continue to face disproportionate hardship as the labour market cools further.
English