16 September 2025
If you are covering the latest UK labour market statistics, please see the following comment from Richard Carter, head of fixed interest research at Quilter Cheviot:
“The latest UK labour market statistics show the jobs market lost further momentum in August. The number of payrolled employees fell by 142,000 between July 2024 and July 2025, and by 6,000 between June and July 2025. Meanwhile, the unemployment figure held steady at 4.7%. Early estimates for August reveal the number of payrolled employees was 30.3 million, a fall of 0.4% compared to August 2024 and equivalent to 127,000 less employees.
“On a monthly basis, the number of payrolled employees decreased by 8,000 in August compared to July. The largest increase came from the health and social work sector, which added 80,000 employees, while the accommodation and food service activities sector experienced the largest decrease with a fall of 90,000 employees. These figures follow a revision to July’s early estimate as a result of additional real time data inputs, which took it from a decrease of 8,000 to 6,000. The Office for National Statistics has also warned that August’s figure may also be revised, so today’s numbers will need to be taken with a pinch of salt.
“Rising wage growth, and the upward pressure that it puts on inflation, has been a source of friction for the Bank of England’s monetary policy committee of late. This month, annual growth in regular earnings excluding bonuses has seen a slight decline to 4.8% compared to 5.0% last month, but total earnings including bonuses rose by 4.7% compared to 4.6%.
“Today’s figures come just two days before the BoE monetary policy committee meets to confirm its next interest rate decision. Still high wage growth, albeit slightly lower than last month’s, will no doubt fuel the increasing concerns over inflation, particularly if tomorrow’s inflation print comes in hot, and the weaker employee numbers add pressure to what is already a difficult balancing act. The MPC is expected to hold rates for now, but this continued weakness in the labour market may encourage the doves on the committee to continue voting for lower rates.”
