UK Unemployment Rate Highest In More Than Two Years

The unemployment rate in the United Kingdom has unexpectedly risen to its highest level in two and a half years, official figures show, Mitchell Labiak and Andy Verity reported for BBC News.

The UK's unemployment rate climbed to 4.4% in the three months to April, the highest since September 2021.

The rate climbed to 4.4% in the three months to April, the highest since September 2021. Despite the increase, wage growth remained strong, with earnings continuing to rise faster than prices.

There was another increase in the inactivity rate, bringing it to its highest level in nearly a decade, with more than 20% of working-age people deemed not to be actively looking for work.

"This month's figures continue to show signs that the labor market may be cooling, with the number of vacancies still falling and unemployment rising, though earnings growth remains relatively strong," the Office for National Statistics (ONS) said.

Regular earnings, which exclude bonuses, rose at an annual pace of 6%, the ONS said, unchanged from the previous month. However, when the impact of inflation is stripped out, pay increased at an annual pace of 2.9%, the highest since August 2021.

Economists had been expecting an uptick in pay because of the increase to the National Living Wage in April. For people aged 21 and over, it rose to £11.44 an hour, up 9.8% from last year.

While the ONS has urged caution about the unemployment figures because its survey sample is small, they are backed up by the more recent figures on employers’ payrolls, which show the number of employees dropped by 36,000 between March and April, and continued to drop in May.