As of February 2025, we’ve reviewed the latest labour market data for the UK, covering the period from October to December 2024. This report from the Office for National Statistics (ONS) sheds light on several important indicators, including trends in payrolled employees, employment, unemployment, economic inactivity, vacancies, earnings, and labour disputes. Understanding these trends is crucial for us as a business, as they help us make informed decisions about workforce planning, compensation strategies, and recruitment priorities. By staying updated on these key figures, we can better anticipate changes in the labour market and respond effectively.

---

Key Findings

Payrolled Employees

Estimates of UK payrolled employees rise by 44,000 (0.1%) between November and December 2024. However, it fell by 44,000 (0.0%) between December 2023 and December 2024.

The total number of payrolled employees in the UK decreased slightly by 3,000 (0.0%) over the quarter but increased by 106,000 (0.3%) over the year, looking at October to December 2024.

The early estimate for January 2025 showed a increase of 21,000 (0.1%) on the month, and an increase of 49,000 (0.2%) on the year to 30.4 million.

Employment and Unemployment

The UK employment rate for people aged 16 to 64 years stood at 74.9% for October to December 2024. This is both above estimates of a year ago and an increase in the latest quarter.

The unemployment rate for those aged 16 and over was estimated at 4.4% in October to December 2024, up from the previous quarter and above of the same period a year ago.

The economic inactivity rate, which refers to individuals aged 16 to 64 not in work or actively seeking work, was 21.5%, showing a decrease compared to both last year and the previous quarter.

Vacancies and Claimant Count

Job vacancies decreased by 9,000 on the quarter to 819,000 in November 2024 to January 2025. This marks the 31st consecutive quarter of decline in vacancies, although they still remain above (COVID-19) pre-pandemic levels.

The Claimant Count, which tracks the number of people claiming unemployment benefits, slightly rose to 1.750 million in January 2025, showing an increase both month-on-month and year-on-year.

Earnings Growth

Annual growth in employees’ average regular earnings excluding bonuses was 5.9% in October to December 2024, with annual growth in total earnings including bonuses being 6.0%. Pay data from HM Revenue and Customs Pay As You Earn (PAYE) Real Time Indicators (RTI) showed similar annual growth rates.

When adjusted for inflation, both regular pay and total pay was 2.5%, based on the Consumer Prices Index including owner occupiers’ housing costs (CPIH)

Labour Disputes

Labour disputes resulted in an estimated 52,000 working days lost in December 2024.

---

Looking at the labour market data for October to December 2024, we see both positive and challenging trends. While payrolled employment saw a small monthly decline, it remained higher than the previous year. The employment rate increased in the latest quarter, and economic inactivity decreased slightly. However, unemployment rose to 4.4%. Job vacancies continued their long-term decline, and the Claimant Count increased. Despite these shifts, earnings grew by 5.9% annually, with real wages rising after adjusting for inflation. Labour disputes led to 52,000 working days lost in December.

Source: Labour market overview, UK – Office for National Statistics