ONS Labour Market Data June 2026: Youth Unemployment Hits 14.7%. What Happens To The 1 in 7 Young People Looking For Work?

The latest Office for National Data was released today. The ONS estimates that payrolled employees in the UK fell by 104,000 (0.3%) between March 2025 and March 2026, and decreased by 28,000 (0.1%) between February and March 2026. The early estimate of payrolled employees for April 2026 decreased by 210,000 (0.7%) on the year, and by 100,000 (0.3%) on the month, to 30.2 million.

The UK employment rate (based on the ONS Labour Force Survey) for people aged 16 to 64 years was estimated at 75.0% in January to March 2026, against a Government target of 80% employment rate. The UK unemployment rate for people aged 16 years and over was estimated at 5.0% in January to March 2026. This is up 0.5 percentage points on the year but down 0.2 percentage points on the latest quarter.

The lowest level of vacancies (705,000) since February to April 2021

The estimated number of vacancies in the UK has decreased in the latest quarter, following broadly flat estimates between March to May 2025 and December 2025 to February 2026. Early estimates for February to April 2026 suggest a decrease of 28,000 (3.9%), to 705,000, compared with November to January 2026, the lowest level of vacancies since February to April 2021. Vacancy numbers on the quarter were down 28,000 and 54,000 less than a year ago.

Youth Unemployment now 14.7%

Ben Harrison, Director of the Work Foundation at Lancaster University, highlights that “young people are bearing the brunt of today’s weak labour market. Youth unemployment has risen to 14.7% – with one in seven young people now seeking work. This is the highest rate in more than a decade, reaching levels not seen since September-November 2014. The proportion of young jobseekers out of work for more than a year has risen to over one in five (22.7%)”.

Redundancy Rates Are Higher Than A Year Ago

Neil Carberry, Chief Executive of the Recruitment and Employment Confederation (REC) also highlighted that Redundancy rates remain higher than a year ago, while vacancies remain lower than they have been for some time. Wages have also moderated, which suggests that the external price shock of this spring is unlikely to be embedded domestically by rising wages.

London Still Has The Highest Regional Unemployment rate in the UK at 7.3%

The ONS Figures highlight that London continues to have the highest regional rate of unemployment in the UK at 7.3%. In January 2026, London’s unemployment rate was 7.2%, so there has been a slight increase in unemployment rates in London.

The UK economic inactivity rate for people aged 16 to 64 years was estimated at 20.9% in January to March 2026. This is down 0.4 percentage points on the year but up 0.1 percentage points on the latest quarter. The UK Claimant Count for April 2026 increased on the month but decreased on the year to an estimated 1.699 million.

Sector Reaction:

Ben Harrison, Director of the Work Foundation at Lancaster University, said:

“Today’s labour market figures underline the importance of the Government remaining focused on the challenges facing young people in accessing sustainable and well-paid work.

“Unemployment remains high at 5.0%, but young people are bearing the brunt of today’s weak labour market. Youth unemployment has risen to 14.7% – with one in seven young people now seeking work. This is the highest rate in more than a decade, reaching levels not seen since September-November 2014. The proportion of young jobseekers out of work for more than a year has risen to over one in five (22.7%).

“Outside of the pandemic, vacancies have fallen to their lowest level for 11 years. There are now just 705,000 vacancies as employers hold back from hiring which is creating one of the most competitive job markets in recent memory. This is making it particularly difficult for young people to take their first steps into the world of work.

“And for those in work, pay growth is also slowing at a time when inflation remains stubbornly above the Bank of England’s target. Workers in the private sector are experiencing the lowest wage growth at 3.0% since October 2020. Persistently high unemployment coupled with weak wage growth is a double blow for living standards with real average weekly earnings have stayed at £492 for the last year. This lack of real wage growth has weakened households’ ability to cope with further living cost increases as the impacts of war in the Middle East continue to feed through to workers’ pockets.

“Despite Westminster being engulfed by political turbulence, it’s vital that Government continues to take action to boost jobs growth and support those out of work to enter secure and sustained employment. In particular, for young people, it’s critical that the Youth Guarantee offers genuine pathways to secure and good quality work, while the Milburn Review provides an opportunity to address the underlying barriers separating too many young people from the jobs market.”

Olly Newton, Executive Director at the Edge Foundation:

“Today’s labour market figures, which show youth unemployment at its highest level over a decade amidst a declining number of vacancies, once again underline the imperative of aligning our education and skills system with workforce need. 

“To avert further increases in the number of young people not in education, employment or training (NEET), the Government should look to support initiatives that have been demonstrated to reduce young people’s likelihood of becoming NEET. These include high-quality careers advice and guidance in schools, work experience, vocational pathways, and real-world learning within the curriculum. We look forward to the outcomes of the Milburn Review in this context.

“Rising NEET rates have also coincided with a decline in apprenticeships for young people, particularly within small and medium-sized enterprises (SMEs), which now employ only 37% of apprentices despite representing 60% of total employment in the UK. To reverse this trend, the Apprenticeships Work campaign has called on the Government to invest in tailored advice and support for SMEs, such as that delivered by apprenticeship brokerage hubs across England.”

The ONS published its latest labour market figures this morning. The Recruitment and Employment Confederation (REC) Chief Executive Neil Carberry said:

“This is a jobs market waiting for a signal. It has trended gently downwards over the past few months as uncertainty is high, but underlying growth has been reassuring. Releasing corporate and household cash reserves to work in our economy is the only way to get moving. That requires a shot of confidence that isn’t there right now due to the crisis in the Gulf, domestic political uncertainty and the huge government-imposed rises in the cost of employment firms have faced.

“Redundancy rates remain higher than a year ago, while vacancies remain lower than they have been for some time. Wages have also moderated, which suggests that the external price shock of this spring is unlikely to be embedded domestically by rising wages.

“The UK now needs a more pragmatic approach to labour market policy to support business confidence, including a rethink of measures such as guaranteed hours requirements, which risks becoming a costly misstep by raising business costs and pushing workers into less secure forms of employment.”

Responding to new ONS figures, which show that London continues to have the highest regional rate of unemployment in the UK at 7.3%, Muniya Barua, Deputy Chief Executive at BusinessLDN, said:

“London is at the sharp end of a UK-wide slowdown in the jobs market, with young people finding it especially hard to get their foot on the careers ladder.

“High employment costs, rising prices due to the Iran war overseas, and political uncertainty at home are all weighing on hiring and investment plans among businesses.

“Amid a leadership contest in Westminster, the Government needs to urgently re-focus on growth and should be exploring all the options it has to bring down operating costs, including making good on its manifesto commitment to overhaul business rates and monitoring the impacts of last year’s hike to employer national insurance contributions.”  

Harry Hobbs, Head of Business Intelligence at Baltic Apprenticeships, commented:

“Today’s figures indicate that the labour market continues to cool, with employers exercising caution as we approach the midway point of 2026. Quarterly vacancies remain subdued, sitting at 705,000 between February and April, suggesting businesses are feeling the strain of an uncertain economic environment.

“It’s a testing market for candidates, particularly those trying to land that first role. Equally, businesses risk creating a skills shortfall by pulling too far back on workforce investment, particularly across digital, data and tech, where candidates with specialist skills are typically harder to find.

“Apprenticeships give employers a structured way to keep building specialist skills across their organisations, even in a tighter market. By developing technical and commercially relevant skills around current business needs, high-quality courses can protect future capability and keep routes into skilled work open.”

Chris Goulden, Director of Impact & Evidence at Youth Futures Foundation, comments: 

“Today’s ONS Labour Market statistics reveal that both unemployment and economic inactivity have risen. Around 1 in 7 young people not in full time education and in the labour force (14.6%, around 471,000) are searching but unable to find work. Additionally, 1 in 5 (21.4%, or around 882,000) young people not in full time education are economically inactive. Since last year, these numbers have increased by almost 70,000 unemployed young people and over 72,000 more who are economically inactive. 

“These figures should serve as a reminder that improving outcomes for young people must remain a policy priority. The long-term economic and social costs of prolonged youth unemployment are substantial, both for individuals and for the wider economy. 

“As our Youth Employment 2025 Outlook demonstrates, the prize of tackling the UK’s persistent youth employment challenge is enormous. Helping more young people into good work could deliver major benefits for both individuals and the wider economy. If the UK matched the Netherlands’ youth participation rate, around 567,000 more young people would be in work or education, boosting the economy by an estimated £86 billion over the long term.” 

Jeanette Wheeler, Chief People Officer at MHR said:

“The figures are telling us a confusing narrative about the state of the UK. Last week it was reported that the UK economy showed a 0.3% growth in GDP in March, but today we’re seeing the UK unemployment rate has risen to 5%, and wage growth has fallen to 3.4%, down from 3.6% in the last quarter.

“Vacancies have decreased and the number of payrolled employees has fallen by 100,000 after a decrease of 28,000 this quarter. The impact of the conflict in the Middle East is leaving some business leaders wondering how they’re going to keep the lights on, and that’s compounding the AI effect – all creating a dark picture for the UK labour market.

“It’s understandable that business leaders are hesitant to invest in the workforce, but they will be unable to realise the potential of their organisation if they stall investment in roles and skills development. With so many organisations fighting for relevance, leaders must be acting in a way that ensures they’re staying innovative, competitive, and tuned to their customers’ needs – and that’s not possible without people.”