Unemployment rate rises again as job market weakens – Chamber

Business leaders today called on the Chancellor to use this month’s Budget to invest in workforce health and skills after new figures revealed a continued climb in unemployment.

According to the Office for National Statistics (ONS), West Midlands unemployment rose by 0.2 per cent in the July to September period.

At 6 per cent, the West Midlands continues to have the highest unemployment rate of any UK region.

However, employment also increased slightly, by 0.1 per cent.

Nationally, the jobless rate has risen to 5 per cent – its highest level since the December 2020 to February 2021 period.

Average wage growth was 4.6 per cent in the quarter, down from 4.7 per cent over the three months to August.

In an early estimate, the number of people on company payrolls fell by 180,000 in the year to October, a drop of 0.6 per cent.

Job vacancies are largely unchanged, with around 723,000 between August and October 2025.

Emily Stubbs (pictured), head of policy at Greater Birmingham Chambers of Commerce, said: “Unemployment continued to rise over the quarter, contributing to a significant increase since the same period last year. Nevertheless, employment also edged up slightly.

“It appears that this has been largely driven by previously economically inactive residents moving back into the labour market and struggling to find work, as vacancies remain virtually unchanged on the quarter. 

“While the rate of wage growth with bonuses has slowed again, this will be of little reassurance to employers, as it continues to outpace inflation.

“Our latest Quarterly Business Report surveying found that labour costs - particularly as a result of employer National Insurance increases - remain the biggest source of price pressures for Greater Birmingham businesses, impacting hiring and investment intentions.

“With job vacancies static, still-high levels of economic inactivity and £5bn of extra employment legislation around the corner, the Budget must give firms a reason to be optimistic.  

“Businesses need confidence to boost investment and drive the economic growth we all want to see. 

“The number one priority for firms is that no fresh tax burdens are placed on them in the Budget. The Chancellor must also use her statement to invest in workforce health and skills.”