UK unemployment rises to 5.2% in late 2025, the highest since 2021, as weak hiring and slowing wage growth signal economic strain.
LONDON: Britain’s unemployment rate climbed to a five-year high of 5.2% in the final quarter of 2025.
Official data from the Office for National Statistics (ONS) showed a slight increase from the 5.1% rate recorded in the three months to the end of November.
This marks the highest level of joblessness since January 2021, a period that coincided with the Covid-19 pandemic.
“The number of workers on payroll fell further in the final quarter of the year, reflecting weak hiring activity,” ONS director of economic statistics Liz McKeown said in a statement.
Analysts noted the data increases the likelihood of the Bank of England cutting its benchmark interest rate next month.
This forecast contributed to pressure on the pound sterling on Tuesday.
The labour market data follows recent official figures showing Britain’s economy grew less than expected in the final quarter of 2025.
“Continuing the recent trend, the UK labour market… is showing signs of creaking at a time when economic growth is difficult to come by,” said Jonathan Raymond, an investment manager at Quilter Cheviot.
The ONS also reported that wage growth slowed further to 4.2% in the fourth quarter.
Overall UK inflation is expected to retreat further in the coming months.
