UK unemployment climbs to 5% as vacancies dip to five-year low amid Iran war shock
UK unemployment climbs to 5% as vacancies dip to five-year low amid Iran war shock
Unemployment rises to 5% while job vacancies fall to a five-year low, signaling a softening labour market amid geopolitical tensions and inflation pressures.
Britain’s unemployment rate unexpectedly rose to 5% in the three months to March, up from 4.9%, as firms slow hiring amid economic and geopolitical uncertainty linked to the Iran war.
Payroll figures also point to a tougher period for workers, with 100,000 fewer people on UK payrolls in April, bringing total payroll employment to about 30.2 million—the largest monthly fall since May 2020.
Vacancies fell by 28,000 quarter-on-quarter to 705,000 in the three months to April, the lowest level recorded since 2021. Retail and hospitality were among the sectors hardest hit as firms paused hiring in the face of uncertain conditions.
Regular earnings growth slowed to 3.4% in the first quarter, the lowest since October 2020, and just ahead of inflation by around 0.3 percentage points, underscoring a softer labour market and cost-of-living pressures for households.
Analysts say the softer jobs market could temper consumer spending and influence monetary policy decisions, with some noting that a June rate hike appears less likely while uncertainty remains high.
