Commenting on the latest ONS labour market data, Jake Finney, Senior Economist at PwC UK, says:
“The latest ONS data suggests the labour market is broadly stabilising. Vacancies are levelling off and the unemployment rate remains unchanged, albeit at its highest level since the pandemic. At the same time, real pay growth is slowing sharply, even before accounting for the recent rise in global energy prices.
“This leaves the Bank of England in a difficult position. The inflation outlook has deteriorated, with a return to target this year looking less likely, but the labour market is significantly softer than during the last inflation surge. That reduces the risk of higher energy prices feeding through into broader inflation and makes further rate hikes harder to justify. But cuts remain unlikely until geopolitical tensions ease.”
About PwC
At PwC, we help clients build trust and reinvent so they can turn complexity into competitive advantage. We’re a tech-forward, people-empowered network with more than 364,000 people in 136 countries and 137 territories. Across audit and assurance, tax and legal, deals and consulting, we help clients build, accelerate, and sustain momentum. Find out more at pwc.com.
© 2026 PwC. All rights reserved.
