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Unemployment in United Kingdom
The United Kingdom's labor market from 2013 to 2022 showed resilience. The unemployment rate steadily declined early in the decade, reaching historic lows by 2019. However, Brexit uncertainties and the COVID-19 pandemic caused disruptions, leading to a temporary spike in unemployment. By 2022, the job market had largely recovered, with unemployment rates back below pre-pandemic levels, although challenges such as labor shortages in specific sectors persisted.
The unemployment rate in the United Kingdom averaged 4.9% in the decade to 2022, below the 6.3% average for major economies. The unemployment rate in 2022 was 3.7%. For more unemployment information, visit our dedicated page.
United Kingdom Unemployment Chart
Note: This chart displays Unemployment Rate for United Kingdom from 2013 to 2022.
Source: UK Office for National Statistics.
United Kingdom Unemployment Data
| 2018 | 2019 | 2020 | 2021 | 2022 | |
|---|---|---|---|---|---|
| Unemployment (% of active population, aop) | 4.1 | 3.8 | 4.6 | 4.5 | 3.7 |
| Unemployment (% of active population, rolling qt) | 4.1 | 3.9 | 5.3 | 4.2 | 3.9 |
Labor market remains robust heading into 2024
According to the statistical office, vacancy numbers declined in the three months to January for the 19th consecutive three-month period. More positively, employment increased by 48,000 month on month in January, the fifth straight month of gains, while the unemployment rate in the three months to December was 3.8%, the lowest in almost a year. In addition, wage growth clocked 5.5% year on year in December, notably above the rate of inflation and thus pointing to improving consumer purchasing power.
Our Consensus is for the unemployment rate to rise slightly in the coming quarters as the effect of past rate hikes is increasingly felt, while sticky wage growth could limit the pace of rate cuts this year.
On the implications for the Bank of England’s monetary stance, Nomura analysts said: “December wage growth was stronger than expected, with upward revisions to the November print. The unemployment rate declined, compared with forecasts for a rise. We think the Bank of England will likely continue to wait for a bit longer before it begins its cutting cycle, owing to heightened uncertainty and volatility over labour market and inflation data.”
Consensus Forecasts and Projections for the next ten years
How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects British unemployment projections for the next ten years from a panel of 35 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable unemployment forecast available for British unemployment.
Download one of our sample reports to visualize what a Consensus Forecast is and see our British unemployment projections.
Want to get access to the full dataset of British unemployment forecasts? Send an email to info@focus-economics.com.
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