United Kingdom (2025)
4.7
% of labor force (ILO methodology)
+0.4pp YoY
YoY Change
+0.4pp
percentage points
Trend
up
Series length
35
years of data

Data

Year% of labor force (ILO methodology)YoY Change
20254.7+0.4pp
20244.4+0.3pp
20234+0.3pp
20223.8-1.1pp
20214.9+0.4pp
20204.5+0.8pp
20193.7-0.5pp
20184.1-0.4pp
20174.5-0.4pp
20164.9-0.6pp
20155.6-0.8pp
20146.4-1.4pp
20137.8-0.5pp
20128.3+0.1pp
20118.2+0.2pp
20108+0.3pp
20097.7+1.9pp
20085.7+0.3pp
20075.4-0.1pp
20065.5n/a

About this Dataset

The UK ILO Unemployment Rate measures the share of the UK labour force that is unemployed under the ILO harmonised definition, compiled by the Office for National Statistics (ONS) from the Labour Force Survey and published by the World Bank in its standardised global development indicators. The 2025 reading of 4.7% — up 1 percentage point from the 3.7% pre-pandemic low of 2019 — reflects a structural shift in the UK labour market characterised by rising economic inactivity alongside modest labour demand softening.

The UK's post-pandemic labour market story diverges meaningfully from those of its G7 peers in one important dimension: the unprecedented rise in working-age inactivity. Unlike Germany, where Kurzarbeit cushioned unemployment, or the US, where a rapid services recovery re-absorbed displaced workers, the UK has seen a persistent increase in the share of working-age persons who are economically inactive due to long-term sickness — estimated by the ONS at over 2.5 million people by 2024. Long-COVID complications, NHS waiting list backlogs (which delay treatment and prolong incapacity), and mental health conditions are the primary attributable causes. This population does not register as unemployed (since they are not seeking work), but it represents withdrawn productive capacity that constrains UK growth and maintains upward pressure on wages in sectors facing genuine labour shortages — construction, healthcare, logistics, and hospitality.

For Bank of England watchers and gilt investors, the UK's 4.7% unemployment rate must be read alongside wage growth data (AWE, ONS) and services CPI inflation. The BoE's dual concern — inflation still above target at 3.3% (2024) while growth weakens — has made its easing cycle more cautious than the ECB's. The BoE estimates its equilibrium unemployment rate (NAIRU) at approximately 4–4.5%, placing the current 4.7% just above that range — providing modest disinflationary impulse from the labour market channel, but insufficient to guarantee a rapid return to 2% inflation without services price moderation. For PE sponsors with UK portfolio companies, the structural labour shortage in blue-collar sectors translates into above-trend wage settlements for several years ahead.

Coverage and methodology: The World Bank compiles this series from ONS Labour Force Survey data, applying ILO methodology to ensure cross-country comparability. The ONS has experienced significant LFS response rate issues since 2020 and undertook a major survey redesign in 2023–2024 that temporarily affected data reliability. The World Bank figure for 2025 incorporates ONS revised methodology. The ILO rate is distinct from the UK claimant count and from the national statistics "unemployment" rate sometimes cited in BoE communications — all three measures use ILO definitions but differ in coverage period and seasonal adjustment.

Frequently Asked Questions

The World Bank's UK ILO unemployment rate is derived from the Office for National Statistics (ONS) Labour Force Survey, standardised to the International Labour Organization definition: a person is unemployed if they had no work in the reference week, were available to start within two weeks, and had actively sought work in the past four weeks. This ILO rate is comparable with EU member state rates published by Eurostat and differs from the UK's claimant count (Jobseeker's Allowance plus Universal Credit job-seeking claimants), which applies different eligibility criteria and typically reads 1–2 percentage points lower than the ILO rate.
The UK's unemployment rate troughed at 3.7% in 2019 and rose to 4.7% by 2025. Two distinct episodes drove the increase: COVID-19 in 2020–2021 (cushioned by the furlough scheme, which at peak covered approximately 9 million workers and prevented a severe unemployment spike); and the post-furlough normalisation combined with a significant structural increase in economic inactivity driven by long-term sickness. The ONS has documented an unprecedented rise in working-age inactivity due to long-COVID, NHS waiting lists, and mental health conditions. These inactive persons are not counted as unemployed (they are not seeking work), but they represent a labour force withdrawal that reduces economic capacity and has been a persistent concern for the BoE's productivity outlook.
At 4.7% in 2025, the UK's ILO unemployment rate is above Germany's (3.8%) but below France's (7.7%), Italy's (6.1%), and Spain's (10.5%). Versus the US (4.2%), the UK runs slightly higher — unusual historically, as both markets have typically been within a narrow band. The UK's post-Brexit labour market has experienced structural changes — reduced migration from the EU has created labour shortages in sectors like hospitality, construction, and agriculture that upward wage pressures have only partially alleviated. The BoE has highlighted labour market tightness as a persistent driver of services inflation, even as the headline rate has declined from its 2022–2023 peak.
The Bank of England monitors the ILO unemployment rate as a primary labour market indicator alongside wage growth and the claimant count. At 4.7% — modestly above the BoE's estimated natural rate of approximately 4–4.5% — the labour market is generating limited additional unemployment slack while wage growth remains above the level consistent with the BoE's 2% CPI target. For gilt investors, the BoE's easing cycle is constrained by the combination of above-target inflation and a labour market that has not loosened sufficiently to guarantee a sustained return to 2% inflation. Watch BoE MPC minutes for the trade-off between the unemployment trend and services CPI when calibrating rate-cut timing.