PwC comments on June 2025 ONS labour market data

Commenting on the latest ONS labour market data for June 2025, Paige Tao, economist at PwC UK, said:

“The labour market continues to show signs of slowing. The unemployment rate edged up again to 4.6% - the first time it has exceeded its pre-pandemic rate. Payrolled employment fell by 109,000 and vacancies declined further, marking the 35th consecutive quarterly drop, with quarterly falls recorded in 14 out of 18 industry sectors. With rising national insurance costs, a higher minimum wage, and escalating global tariffs all contributing to heightened cost pressures for employers, today’s figures show that businesses are clearly feeling the squeeze.

“If there’s any upside, it may be in the battle to control inflation. Annual wage growth excluding bonuses eased to 5.2% in the latest figures, marking the second consecutive monthly decline. This gradual cooling in pay growth may offer some reassurance to the Bank of England, following last month’s inflation reading unexpectedly jumping to its highest level in over a year. However, with wage growth remaining high in absolute terms, the Bank may want to see this trend continue before proceeding with further rate cuts.”