London Daily

Focus on the big picture.
Thursday, Oct 02, 2025

UK job vacancies hit record high of 1m as payrolls rebound to pre-Covid levels

UK job vacancies hit record high of 1m as payrolls rebound to pre-Covid levels

Hotels, pubs and restaurants among those with biggest problems recruiting staff

Employers scrambling to hire staff amid widespread labour shortages after lockdown helped to return the number of workers on company payrolls to pre-pandemic levels in August, official figures show.

The Office for National Statistics said the number of payroll employees increased by 241,000 to 29.1 million in August, lifting employment in all regions of the UK to pre-Covid levels except in London, Scotland and south-east England.

It came as the number of job vacancies soared to more than 1m in August for the first time since official records began in 2001, rising by 35% in the space of three months across all sectors of the British economy.

Reflecting difficulty hiring staff after lockdown for a wide range of businesses across Britain, the ONS said the largest increase was in accommodation and food services – the sector which includes hotels, pubs and restaurants – with a 75% increase over the past three months.


Business leaders have warned that shortages of workers and raw materials will hold back Britain’s economic recovery from the pandemic, with lobby groups calling for looser post-Brexit migration rules to enable firms to hire more staff from the EU.

The number of EU nationals working in Britain has dropped during the pandemic as many workers returned to their home countries, while ongoing concerns around Covid, pandemic restrictions, and post-Brexit migration rules have limited their return.

Despite the rise in the number of payrolled employees in August, which is collected from HMRC data, the ONS said employment in the UK still remained below pre-Covid levels in official data gathered in its labour force survey in the three months to July.

Unemployment was estimated at 4.6%, a drop of 0.3 percentage points on the previous quarter but still 0.6 percentage points higher than before the pandemic struck.


Employment, which measures the proportion of people aged 16 to 64 in work, rose steadily to 75.2% in the three months to the end of July, but remains 1.3 percentage points lower than pre-Covid levels.

The official headline rates differ from the HMRC payroll numbers because they are based on surveys rather than company filings and cover a three-month period. The HMRC figures also exclude self-employment and may double count some workers who have more than one job.

About 1.6m jobs were still furloughed at the end of July, according to the latest data published by HMRC last week, with the highest numbers in sectors of the economy where pandemic restrictions are toughest. More than half of the total workforce in air passenger transport remains on furlough, while there are also large numbers in the arts and leisure industries.

Nye Cominetti, the senior economist at the Resolution Foundation, said self-employment remains 700,000 down on pre-Covid levels, adding that as many as 1 million employees could still be on furlough when the scheme closes at the end of this month.

“There is still ground to make up in the labour market. With the furlough scheme ending in little over two weeks’ time, we should expect a fresh rise in unemployment this autumn, particularly among furloughed staff that aren’t able to return to their previous jobs,” he said.

Some economists said the economy appeared to be well prepared for the end of furlough, suggesting that record job vacancies could help to prevent a sharp rise in unemployment.

Grant Fitzner, the chief economist at the ONS, said government data from the Insolvency Service suggested there was little evidence to suggest there would be a sharp rise in redundancies when the scheme ends. Employers must report plans to dismiss 20 or more staff as redundant within a period of 90 days.

“I wouldn’t say there won’t be some people losing jobs, but it’s safe to say ‘so far so good’,” he said.

However, others warned that mismatches between the areas where workers are losing their jobs and those where there are record vacancies would cause issues. Yael Selfin, the chief economist at KPMG UK, said there was likely to be “more pain to come” once furlough ends, and as firms struggle to hire staff.

“While the pressure should ease as more people look to return to work and the furlough scheme ends, the UK labour market is set to remain choppy with vacancies taking time to fill due to skills shortages and reduced availability of overseas workers,” she said.

Rishi Sunak, the chancellor, said the latest figures showed the government’s plan for jobs was working, with unemployment falling for seven months in a row. “As we continue to recover from the pandemic, our focus remains on creating opportunities and supporting people’s jobs,” he added.

Newsletter

Related Articles

0:00
0:00
Close
Trump Administration Launches “TrumpRx” Plan to Enable Direct Drug Sales at Deep Discounts
Trump Announces Intention to Impose 100 Percent Tariff on Foreign-Made Films
Altman Says GPT-5 Already Outpaces Him, Warns AI Could Automate 40% of Work
Singapore and Hong Kong Vie to Dominate Asia’s Rising Gold Trade
Trump Organization Teams with Saudi Developer on $1 Billion Trump Plaza in Jeddah
Manhattan Sees Surge in Office-to-Housing Conversions, Highest Since 2008
Switzerland and U.S. Issue Joint Assurance Against Currency Manipulation
Electronic Arts to Be Taken Private in Historic $55 Billion Buyout
Thomas Jacob Sanford Named as Suspect in Deadly Michigan Church Shooting and Arson
Russian Research Vessel 'Yantar' Tracked Mapping Europe’s Subsea Cables, Raising Security Alarms
New York Man Arrested After On-Air Confession to 2017 Parents’ Murders
U.S. Defense Chief Orders Sudden Summit of Hundreds of Generals and Admirals
Global Cruise Industry Posts Dramatic Comeback with 34.6 Million Passengers in 2024
Trump Claims FBI Planted 274 Agents at Capitol Riot, Citing Unverified Reports
India: Internet Suspended in Bareilly Amid Communal Clashes Between Muslims and Hindus
Supreme Court Extends Freeze on Nearly $5 Billion in U.S. Foreign Aid at Trump’s Request
Archaeologists Recover Statues and Temples from 2,000-Year-Old Sunken City off Alexandria
China Deploys 2,000 Workers to Spain to Build Major EV Battery Factory, Raising European Dependence
Speed Takes Over: How Drive-Through Coffee Chains Are Rewriting U.S. Coffee Culture
U.S. Demands Brussels Scrutinize Digital Rules to Prevent Bias Against American Tech
Ringo Starr Champions Enduring Beatles Legacy While Debuting Las Vegas Art Show
Private Equity’s Fundraising Surge Triggers Concern of European Market Shake-Out
Colombian President Petro Vows to Mobilize Volunteers for Gaza and Joins List of Fighters
FBI Removes Agents Who Kneeled at 2020 Protest, Citing Breach of Professional Conduct
Trump Alleges ‘Triple Sabotage’ at United Nations After Escalator and Teleprompter Failures
Shock in France: 5 Years in Prison for Former President Nicolas Sarkozy
Tokyo’s Jimbōchō Named World’s Coolest Neighbourhood for 2025
European Officials Fear Trump May Shift Blame for Ukraine War onto EU
BNP Paribas Abandons Ban on 'Controversial Weapons' Financing Amid Europe’s Defence Push
Typhoon Ragasa Leaves Trail of Destruction Across East Asia Before Making Landfall in China
The Personality Rights Challenge in India’s AI Era
Big Banks Rebuild in Hong Kong as Deal Volume Surges
Italy Considers Freezing Retirement Age at 67 to Avert Scheduled Hike
Italian City to Impose Tax on Visiting Dogs Starting in 2026
Arnault Denounces Proposed Wealth Tax as Threat to French Economy
Study Finds No Safe Level of Alcohol for Dementia Risk
Denmark Investigates Drone Incursion, Does Not Rule Out Russian Involvement
Lilly CEO Warns UK Is ‘Worst Country in Europe’ for Drug Prices, Pulls Back Investment
Nigel Farage Emerges as Central Force in British Politics with Reform UK Surge
Disney Reinstates ‘Jimmy Kimmel Live!’ after Six-Day Suspension over Charlie Kirk Comments
U.S. Prosecutors Move to Break Up Google’s Advertising Monopoly
Nvidia Pledges Up to $100 Billion Investment in OpenAI to Power Massive AI Data Center Build-Out
U.S. Signals ‘Large and Forceful’ Support for Argentina Amid Market Turmoil
Nvidia and Abu Dhabi’s TII Launch First AI-&-Robotics Lab in the Middle East
Vietnam Faces Up to $25 Billion Export Loss as U.S. Tariffs Bite
Europe Signals Stronger Support for Taiwan at Major Taipei Defence Show
Indonesia Court Upholds Military Law Amid Concerns Over Expanded Civilian Role
Larry Ellison, Michael Dell and Rupert Murdoch Join Trump-Backed Bid to Take Over TikTok
Trump and Musk Reunite Publicly for First Time Since Fallout at Kirk Memorial
Vietnam Closes 86 Million Untouched Bank Accounts Over Biometric ID Rules
×