29 September 2025
Labour Market Analysis to July 2025 – economic inactivity down again
Unemployment in the UK rose by 35,000 compared to the previous quarter to 1.62 million, with the unemployment rate rising from 4.7% to 4.8%. Employment also grew, by 117,000 pushing the employment rate up from 75.1% to 75.2%.
Economic inactivity fell by 63,000, down from 21.3% to 21.1% or 9.1m people. After continued improvement, the economic inactivity rate remains lower than any time following the pandemic, though the unemployment rate is also at its highest level since the pandemic.
Average earnings growth dipped from 5.0% to 4.8%, with inflation rising from 4.1% to 4.2%, the highest in the G7. US inflation remained at 2.7% and the Eurozone average stayed steady at 2.0%.
Read the Learning & Work Institute’s full analysis.
Economic inactivity fell by 63,000, down from 21.3% to 21.1% or 9.1m people. After continued improvement, the economic inactivity rate remains lower than any time following the pandemic, though the unemployment rate is also at its highest level since the pandemic.
Average earnings growth dipped from 5.0% to 4.8%, with inflation rising from 4.1% to 4.2%, the highest in the G7. US inflation remained at 2.7% and the Eurozone average stayed steady at 2.0%.
Read the Learning & Work Institute’s full analysis.
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