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ONS Labour Market May 2026

Payrolls continue to weaken

  • Payrolled employees fell by 104,000 (0.3%) between March 2025 and March 2026.
  • Compared with the previous month, payroll numbers decreased by 28,000 (0.1%). 
  • Across January to March 2026, payrolled employees declined by 94,000 (0.3%) year-on-year and by 20,000 (0.1%) on the quarter.
  • The early estimate for April 2026 suggests a decrease of 210,000 (0.7%) on the year and 100,000 (0.3%) on the month, taking the total to 30.2 million (provisional and subject to revision).

Unemployment remains elevated 

  • The UK employment rate for people aged 16-64 was 75.0% in January to March 2026, broadly unchanged on the year but marginally higher on the quarter.
  • The unemployment rate stood at 5.0%, remaining elevated compared with a year earlier, although it eased by 0.2 percentage points from the previous quarter.

Inactivity edges up as claimant numbers rise

  • The economic inactivity rate (aged 16-64) stood at 20.9%, up slightly on the quarter but down 0.4 percentage points on the year.
  • The Claimant Count increased on the month in April 2026 but decreased on the year, reaching 1.699 million (provisional).

Vacancies fall to lowest level since 2021

  • Job vacancies continued to trend downward, with early estimates for February to April 2026 showing a fall of 28,000 (3.9%) on the quarter to 705,000.
  • This marks the lowest vacancies level since February to April 2021 and indicates further easing in employer hiring demand.

Pay growth loses momentum

  • Regular earnings (excluding bonuses) slowed to 3.4% YoY, while total earnings (including bonuses) rose by 4.1% in January to March 2026.
  • Public sector regular pay grew by 4.8%, compared with 3.0% in the private sector.
  • In real terms:
    • CPIH-adjusted earnings rose by 0.1% for regular pay and 0.8% for total pay.
    • CPI-adjusted earnings increased by 0.3% for regular pay and 1.0% for total pay. 

Labour disputes remain relatively subdued

  • An estimated 23,000 working days were lost because of labour disputes across the UK in March 2026, remaining well below peaks seen during the recent wave of industrial action.

The unemployment rate was up on the year, but was down in the latest quarter

Source: ONS

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