UK unemployment rate hits near five-year high as wage growth slows - live updates
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'All my friends are talking about is the job search'published at 09:12 GMT
Hannah Mullane, a business reporter, shares her experience of the job market. Lucy Gabb, a recent Cambridge University graduate with a degree in French, is struggling to find employment despite applying for over 50 graduate and entry-level roles. She highlights the long application process and the lack of responses, which can be soul-destroying for recent graduates.
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Workers are 'paying the price for government failures' - Lib Dems
Daisy Cooper, the Liberal Democrat Treasury spokesperson, criticizes the government's policies, such as the 'damaging jobs tax' and 'betrayal on business rates', which are affecting small and high streets across the UK. The Lib Dems propose an 'emergency VAT cut for hospitality' to boost job opportunities.
3.
Uncertainty can lead employers to sit on their hands
Simon Jack, the business editor, explains that employers' reluctance to hire is due to various factors, including increased National Insurance contributions, the National Living Wage, and uncertainty around the Employment Rights Act. The late Budget further contributes to this uncertainty, causing employers to hesitate in their hiring decisions.
4.
What does 'unemployment' actually mean?
The Office for National Statistics (ONS) clarifies the definition of unemployment, stating that it requires individuals to be without work, available for work, and actively seeking employment. This definition excludes those who are economically inactive, such as students, retirees, and individuals with long-term illnesses or disabilities.
5.
Unemployment for 18-24s reaches 14% - the highest since 2020
The ONS data reveals a 14% unemployment rate among 18-24-year-olds in the UK, marking a 0.3 percentage point increase from November. This rate is the highest since 2020, except for a three-month period during the pandemic. The unemployment rate for 16-17-year-olds is 34.2%, a slight decrease from November.
6.
These figures could lead the Bank of England to decide it will cut interest rates
Theo Leggett, the international business correspondent, discusses the potential impact of the latest unemployment figures on interest rates. The slow economic growth in the second half of 2025 and the late November Budget contributed to weak hiring activity, with a 130,000 decrease in people on company payrolls. Average pay growth has slowed, and economists predict that the Bank of England may cut interest rates soon.
7.
Youth unemployment 'very high and concerning', recruiter says
Michael Stull, the managing director of ManpowerGroup UK, expresses concern over the high youth unemployment rate. He attributes the drop in hiring to market uncertainty and the reluctance of hiring managers and workers to make decisions in such conditions.
8.
We want to hear from you
The BBC invites readers to share their experiences of job searching or hiring activity through various contact methods, including email, WhatsApp, and social media platforms.
9.
Minister: We know there's more to do - tackling youth unemployment is a key priority
Pat McFadden, the Work and Pensions Secretary, acknowledges the government's efforts to address youth unemployment, including a £1.5 billion initiative and the announcement of easier apprenticeship pathways. However, he recognizes that more needs to be done to get people into jobs.
10.
Tories blame Labour for increasing taxes and 'red tape'
Mel Stride, the Conservative shadow chancellor, criticizes Labour's policies, arguing that higher taxes, soaring business rates, and anti-business 'red tape' are hindering employment. He believes Labour's lack of real-world business experience is evident in their policies.
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Data shows weak hiring activity while more people look for jobs - ONSpublished at 07:44 GMT
Liz McKeown, the director of economic statistics at the ONS, explains that the latest data reflects weak hiring activity, but also notes an increase in the number of people actively seeking jobs. She highlights the stable number of unfilled jobs and the rising unemployment rate, leading to a higher number of unemployed individuals per vacancy. Redundancies are also on the rise, and wage growth in the private sector is slowing.
13.
UK unemployment close to five-year high, ONS figures showpublished at 07:39 GMT
The UK's unemployment rate reached a near five-year high of 5.2% in the last three months of 2025, according to the ONS. This represents a 0.1 percentage point increase from November. The data also shows a 4.2% average annual pay growth, with the public sector outpacing the private sector. The ONS attributes the weak hiring activity to the government's budget hikes in employer National Insurance contributions and the minimum wage.
