Employee Numbers Down: Job Vacancies Down: Unemployment Up

The Office for National Statistics (ONS) has today released its latest report for UK unemployment figures, information on the labour market, young people and workless households.  The trend is still bleak.

1. Payrolled Employees:  HMRC Real Time Information (from employers RTI payroll reporting)

Year‑on‑year:

• –78,000 (–0.3%) June 2025 → June 2026

• –86,000 (–0.3%) April–June 2025 → April–June 2026

• –94,000 (–0.3%) July 2025 → July 2026 (flash estimate)

Quarter‑on‑quarter:

• –37,000 (–0.1%) April–June 2026

Latest monthly change:

• –13,000 (0.0%) May → June 2026

• –13,000 (0.0%) June → July 2026 (flash estimate)

Interpretation: RTI continues to show a gradual two‑year decline in employee numbers. Monthly movements are flat, but the longer trend remains downward. July’s flash estimate is provisional and typically revised.

2. Employment, Unemployment & Inactivity (Labour Force Survey LFS)

Employment rate (16–64):

• 75.1% (Apr–Jun 2026)

• +0.1pp on the quarter

• –0.2pp on the year

Unemployment rate (16+):

• 4.9% (Apr–Jun 2026)

• –0.1pp on the quarter

• +0.2pp on the year

Economic inactivity (16–64):

• 20.9% — unchanged on both year and quarter

Interpretation: Unemployment is higher than a year ago, but easing slightly in the latest quarter. Employment is edging up quarter‑on‑quarter but remains below last year’s level. Inactivity is stable.

3. Claimant Count (Department for Work and Pensions)

• 1.665 million (July 2026)

• Down on the month and year

• Recent revisions have tended to be downwards

Interpretation: Claimant Count is falling, but figures are provisional and often revised after work capability assessments conclude.

4. Job Vacancies (ONS Vacancy Survey)

May–July 2026:

• 707,000 vacancies

• –6,000 (–0.8%) on the quarter

• –11,000 since Jan–Mar 2026

Context: Outside COVID‑19, the last time vacancies were this low was 2014. Small firms report recruitment pauses due to rising labour and operating costs.

Interpretation: Vacancies are flat-to-falling, signalling cooling demand for labour.

5. Earnings & Pay Growth

Nominal annual growth (Apr–Jun 2026):

• Regular pay: +3.5%

• Total pay: +4.1%

• Public sector: +6.1%

• Private sector: +2.8%

Real annual growth:

• CPIH-adjusted:

  • Regular pay: +0.5%

  • Total pay: +1.1%

• CPI-adjusted:

  • Regular pay: +0.7%

  • Total pay: +1.3%

Interpretation: Real pay is positive, helped by easing inflation. Public sector pay growth remains elevated due to timing of awards.

6. Labour Disputes

• 47,000 working days lost (June 2026)

7. Data Quality & Methodology Notes

• LFS improvements since 2024 have boosted response rates and changed levels.

• Mid‑2023 to 2024 LFS data remain volatile.

• RTI currently viewed as most reliable for employee counts.

• Workforce Jobs (WFJ) shows recent quarterly increases but often lags and is revised during annual benchmarking (next: Dec 2026).

• Users should focus on long‑term trends, not short‑term volatility.

Our Interpretation

• Labour demand is cooling: vacancies at decade‑low levels, payrolled employees trending down.

• Labour supply is stable: inactivity unchanged, employment slightly up on the quarter.

• Unemployment is rising year‑on‑year, but the latest quarter shows a mild improvement.

• Real pay is growing, offering some relief to households.

• Small businesses are pausing recruitment due to cost pressures.

• Data coherence remains challenging, with LFS, RTI and WFJ showing different short‑term movements.