ONS Labour Market Statistics

ONS Labour Market Statistics: July 2026

A government spokesperson said: 

"While it's welcome that unemployment has fallen slightly, the reality is too many young people are still locked out of work.   

For too long, governments have paid for failure rather than invested in people's success. We're determined to turn that around by creating real opportunities for young people, reforming education so everyone has a clear path to a good job and providing the support people need to stay and get on in work. 

Background:

• The employment rate is up 0.1% points on the quarter to 75.1% (up 0.1% points on the month). 

• The unemployment rate is 4.9% - down 0.1% points on the quarter (unchanged on the month). 

• The economic inactivity rate is 20.9% - down 0.1% points on the quarter (down 0.1% points on the month). 

• The UK is the fastest growing economy in the G7 so far this year and last year, we were the fastest growing European G7 economy. 

• The UK has the 3rd highest employment rate in the G7. 

• The IMF have forecast that the UK will be the fastest-growing G7 economy in Europe this year and next year. 

• Since the election, the Bank of England have cut interest rates six times and since the start of this parliament, real wages have grown every month and have already grown faster than they did over the first decade of the previous government. 

• Businesses can access the new Youth Jobs Grant, which will pay £3,000 for every eligible young person they hire helping thousands more young people take their first step on the career ladder. Funding for businesses who give youngsters a chance as Government ramps up youth jobs drive - GOV.UK 

• Thousands of young people across Great Britain will benefit from access to expanded employment and wrap-around support services as the locations of almost 180 new Youth Hubs are confirmed. Almost 180 more Youth Hubs to help young people build skills and find jobs - GOV.UK 

• Former Health Secretary Alan Milburn is leading a report into the rising number of NEETs and will consider health, skills, employment, and welfare systems. Mr Milburn's interim report published on 28 May warned that the first rung of the career ladder has thinned 

IoD

Commenting on this morning's release of ONS labour market data, Alex Hall-Chen, Principal Policy Advisor for Employment at the Institute of Directors, said:

"Today's data points to a stagnant and weak labour market, with the number of payrolled employees down 0.1% and job vacancies down 0.9% on the quarter.

"This ongoing decline in employer demand for labour is not inevitable; it is the result of a series of employment policy decisions over the past two years which have made hiring staff riskier and more expensive for employers. UK businesses are dealing with a crisis in the cost of employment manufactured by Government and, without a new approach, the situation will not improve.

"Supporting job growth by removing barriers to hiring must be a priority for the incoming Government, starting with meaningful tripartite negotiations on guaranteed hours reforms. The new Prime Minister's commitment to driving economic growth across the country is welcome, but will mean little without action to bring down the cost of employment and boost job creation around the UK."

British Chambers of Commerce

Reacting to the latest labour market data from the ONS,Patrick Milnes,HeadofPolicy for People and Workat the British Chambers ofCommerce,said:  

Today's labour market data is a stark example of the challenges awaiting Andy Burnham as he settles into Number 10. 

While unemployment appears to have stabilized at 4.9%, our expectation is that it will rise further this year as low business confidence impacts hiring.   

The BCC's latestforecastsuggests it could reach 5.2% byChristmasas firmsstruggle witha host of costpressures.  

Withvacanciesfalling,economicinactivity in flux, and private sector wage growth stalling, businesses are waiting to see how global and domestic policies shift.  

Withunemploymentfor1824-year-oldsrising to 14.8%,the outlook for young people is becoming increasingly alarming as they struggle to get a foot on the career ladder.The BCC expects youth unemployment to reach17% this year.  

Against this backdrop it was encouraging to hear the new Prime Minister placing a renewed emphasis on education in his first speech, yesterday. 

But more must now be done to bolster business confidence and unlock hiring by tackling cost pressures on firms, including a holiday on employer national insurance contributions for under 25s. 

Liberal Democrats

Responding to unemployment and borrowing statistics published by the ONS today, which show unemployment has risen and public borrowing at £16bn, Liberal Democrat Treasury Spokesperson Daisy Cooper MP said:

"The new Chancellor needs to turn things around, and fast. The economy is stuck in the slow lane while job seekers and families pay the price.

"Healey now needs to urgently tackle unemployment, by scrapping Rachel Reeves' unfair jobs tax that is stifling businesses and slamming the door shut on job opportunities.

"Today's borrowing figures also show the huge pressure on our public finances. The only real answer is to boost growth, and protect our economy from the global shocks it faces, like Trump's illegal Iran war. That's why Andy Burnham must immediately begin negotiations for a new growth defence partnership with the EU, including joining the Single Market."