UK unemployment falls to lowest in a year but vacancies slide further

The UK’s unemployment rate has fallen to the lowest level in more than a year despite the number of vacancies sliding for another month, new figures show.

The rate of UK unemployment fell to 4.7% in the three months to August, from 4.9% in the three months to July, the Office for National Statistics said.

This was the lowest level since the three months to July 2025.

More timely data suggests that workers on payrolls increased by about 13,000 between August and September.

The ONS’s data also showed a boost for average wage growth across the UK workforce.

Average regular earnings growth rose to 3.7% in the three months to August and was 0.8% higher after taking Consumer Prices Index inflation into account.

However, the number of vacancies in the UK fell by 21,000 to a fresh five-year low of 691,000 in the three moths to September, according to the ONS’s estimates.

This marked the biggest decline since the three months to March.

ONS deputy director of labour market statistics, David Freeman, said: “While the labour market remains broadly flat in 2026, data from the latest quarter shows the employment rate edging up and a small drop in unemployment.

“The number of workers on payroll remains slightly down over the same period, though data for the most recent month suggests that might be starting to level off.

“The number of vacancies has seen its largest fall since the start of the year, concentrated mainly within smaller businesses, which cite increased labour costs as a key factor.

“Regular wage growth remained relatively stable, though total pay – including bonuses – has eased to its lowest rate in nearly six years.”