Labour Market Statistics, September 2026 + reactions
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Click on link below UK Labour market: September 2026 Secretary of
State for Work and Pensions, Pat McFadden said: Today's figures
show a labour market that remains resilient in the face of
significant global economic pressures, with unemployment steady in
recent months and vacancies around their long-term average. But we
know there is more work to do, particularly to ensure young people
gain the skills, experience and confidence needed to
succeed....Request free trial
Click on link below UK Labour market: September 2026 Secretary of State for Work and Pensions, Pat McFadden said: Today's figures show a labour market that remains resilient in the face of significant global economic pressures, with unemployment steady in recent months and vacancies around their long-term average. But we know there is more work to do, particularly to ensure young people gain the skills, experience and confidence needed to succeed. That's why we're backing young people with new work experience opportunities through our partnership with the British Retail Consortium, supporting the retail sector's ambition to create 100,000 jobs, alongside a £2.5 billion investment to transform youth employment support and £3.5 billion in tailored employment support for disabled people. Background:
Conservative Party Helen Whately MP, Shadow Work and Pensions Secretary, said: Under Labour we've seen unemployment go up month after month. Now it's stuck, leaving hundreds of thousands of people out of work and living off welfare. Their taxes and red tape have destroyed jobs and opportunities. Fewer vacancies and fewer payroll jobs puts the security of a steady job with a regular wage out of reach for more and more people. Labour has piled taxes and red tape onto businesses so they can't afford to hire people. They've made getting a job harder but getting welfare easier. Labour has stacked the deck against work. The Conservatives will back businesses to create jobs. We'll cut taxes and roll back the red tape. And we'll reform welfare, so it pays to work. ENDS Notes to Editors:
Labour's choices have increased unemployment:
Only the Conservatives have a plan to make work pay:
British Chambers of Commerce Reacting to the latest labour market data from the ONS,Caterina Batog, Research and Economics Analyst at the British Chambers of Commerce said: Unemployment remained at 4.9%, in the three months to July, a clear indication of the continued stressbusinesses are feeling as they navigate a world of increasing costs. Another rise in youth unemployment is particularly concerning. Business investment intentions are at their lowest level since the pandemic, with confidence continuing toweaken as firms hold off on spending ahead of the Autumn Budget. Last week, the Chancellor outlined how vital business is to the government's plans to grow the economy. But if firms cannot afford to take people on then progress will be slow. The BCC's most recent economic forecastsuggests unemployment could reach 5.0% byChristmas, with youth unemployment hitting 16.6%, as firms continue to face pressure from high labour costs. Our cost stack calculator shows that costs for the average SME have increased by more than 70% in the last ten years due to successive governments' policies. If the Chancellor wants to deliver on No10's promise of growth in every postcode then he must back business and cut costs. That means cutting employer National Insurance contributions for all under-25s, to help tackle the youth employment crisis. And it means a targeted tax reduction package to ease energy and business rate pressures for all firms. IoD Commenting on this morning's release of ONS labourmarket data, Alex Hall-Chen, Principal Policy Advisor for Employment at the Institute of Directors, said: Today's figures show that the labour market is continuing to soften, with the number of payrolled employees down by 26,000 on the month (145,000 on the year) and vacancies down 8,000 on the quarter (36,000 on the year). The IoD's own data paints a similar picture, showing that more business leaders expect to reduce headcount over the coming year than increase it. While a subdued economic outlook and weak business confidence are important factors, employers are also grappling with a series of policy changes that have increased the cost and risk of hiring. These include the Employment Rights Act, above-inflation increases in the National Living Wage, and higher employer National Insurance contributions.
The Government's recognition that the cost of business crisis
needs to be tackled is welcome. However, as set out in the
IoD's Budget submission,
this rhetoric now needs to be backed up by tangible steps to
bring down the cost of employment and restore employer confidence
in hiring. These include: 2. Increasing the planned reference period for the entitlement to guaranteed hours to 52 weeks and set the low hours threshold at eight hours. 3. Avoiding increasing the National Living Wage beyond two-thirds of median income in order to protect entry-level jobs. Without meaningful action in next month's Budget to reduce the cost and risk of employment, there is a real danger that labour market conditions will continue to weaken, with employers remaining unable to create new jobs. Institute of Economic Affairs Responding, Valentin Boboc, Senior Economist, Institute of Economic Affairs, said: Britain's labour market continues to weaken. Today's ONS estimates show payroll employment fell by another 26,000 in August, leaving 145,000 fewer employees than a year ago. Annual median pay growth has also slowed to 3.5 per cent. The weakness is being felt across the country. Payroll employment is down on a year ago in every nation and English region except Northern Ireland, with London recording a 1 per cent fall. Fewer people in work and weaker pay growth will also make it harder to grow tax revenues and repair the public finances. With the Budget approaching, the government should treat these figures as a clear warning against loading further costs and restrictions onto employers. Britain needs businesses hiring and investing, not being given more reasons to hold back. Julian Jessop, Economics Fellow, Institute of Economic Affairs, said: "The economy has now lost more than 200,000 payroll jobs over the last two years. This might be good for the productivity data, but it is bad for real people, especially the young struggling to find work." TUC
Responding to the latest labour market statistics, TUC General Secretary Paul Nowak said: The labour market picture remains finely balanced. Jobs and pay remain under pressure. Supporting more young people into work must remain a key priority. The Government needs to expand the Jobs Guarantee to ensure more young people gain important experience of paid work. Stronger growth is the key, and recent progress on GDP needs to be sustained. It is time to release the handbrake on public investment and continue breaking the UK's cycle of economic stagnation. Resolution Foundation Pay growth in the private sector fell to 2.9 per cent on a cash basis in the three months to July, its joint lowest rate since October 2020, with wages set to shrink significantly in the second half of the year as inflation rises, the Resolution Foundation said today (Tuesday) in response to the latest ONS statistics. The latest ONS data showed another big gap between the strength of nominal regular pay growth in the public and private sectors 6.3 and 2.9 per cent respectively, with strong public sector pay growth driven by the timing of NHS pay settlements. The timing of these settlements has also bumped up the rate of total earning growth across the economy to 3.9 per cent handing pensioners a big boost to the state pension of around £9.41 a week to £250.71 next Spring as a result of the triple lock. Working-age benefits are set to rise by the far lower level of CPI inflation in September, currently forecast to be 3 per cent. There was no such boost for workers in the private sector, however, with average weekly earnings now £2 lower in real terms than they were last October. With nominal wage growth weakening and inflation set to rise across the second half of the year, the UK's private sector pay squeeze will tighten in the coming months. The unemployment rate held steady at 4.9 per cent, but other indicators notably falling payrolled jobs and vacancies continue to suggest a weakening labour market, with the situation especially tough for young people looking to make their first starts. Julia Diniz, Economist at the Resolution Foundation, said: The big winners from today's ONS data are pensioners, who are set for another large rise in the state pension next spring thanks to the triple lock. The biggest losers are workers in the private sector who are already earning less than they were last autumn. With wage growth slumping to its lowest rate in nearly six years, the UK's private sector pay squeeze will tighten over the coming months as inflation rises. With unemployment settling at around five per cent and the number of job vacancies continuing to fall, conditions are also tough for those looking for work, especially young people.
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