Few Signs For Optimism In Labour Market

Reacting to the latest labour market data from the ONS published this morning, Patrick Milnes, Head of People and Work Policy at the British Chambers of Commerce, said: 

“The latest data indicates businesses are still not feeling confident about taking on more staff or expanding their operations.

“The rate of unemployment has held steady at 5.1% and the number of pay-rolled employees has continued to fall, suggesting the labour market is still loosening.

“Wage increases, including bonuses, held steady at 4.7%, providing little relief for businesses who have seen eye-watering growth in employment costs, and know there is still more pain to come.

“With above inflation rises in the minimum and living wage due in April, and a raft of costs associated with new employment legislation, employers will continue to hold back.

“Our most recent survey found that labour costs continue to be the main cost pressure they face, cited by 72% of firms.

“The data also point to a rise in industrial action with an estimated 155,000 working days lost because of labour disputes across the UK in November 2025. This is the highest number of working days lost since January 2024.
 
“Added to this we now have fresh uncertainty emerging around tariffs and businesses will be looking to government for clear signs that it understands the difficulties they face.

“This means it is vital that this is the year of delivery for the Industrial, Trade and Infrastructure strategies announced in 2025.”

More detail on the ONS data can be found here.

Read more latest news from the BCC here.

20.01.2026