UK unemployment fell to 4.7%, but vacancies signalled weaker hiring
Original report:
Britain’s unemployment rate unexpectedly declined in figures reported on 20 October 2026, while payroll employment increased. But vacancies fell to their lowest level since 2021, leaving economists divided over the strength of the labour market ahead of the budget.
UK unemployment fell to 4.7% in the three months to August 2026, down from 4.9%, according to Office for National Statistics figures reported by the Guardian on 20 October. Economists had expected 5%. Payroll employment also increased by 13,000 between August and September, reaching 30.3 million, ahead of what the report described as John Healey’s first budget.
Other indicators were weaker. Vacancies dropped by 21,000 to 691,000 in the three months to September, their lowest since 2021, with construction hiring particularly subdued. Annual pay growth excluding bonuses edged up to 3.7%, while growth including bonuses slowed to the same rate. Economists cited recruitment constraints and warned against interpreting lower unemployment as evidence of broad labour-market strength.
For younger jobseekers, the quarterly improvement did not erase the deterioration over the preceding year. The ONS estimated that 715,000 people aged 16 to 24 were unemployed, down 28,000 on the quarter. Work Foundation director Ben Harrison stressed that the total remained 54,000 higher than a year earlier.
Source
the Guardian — 20 October 2026
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