The big question on the minds of jobseekers, employers and policymakers in early 2026 is simple: after a rocky couple of years, is the UK labour market finally turning a corner? Short answer: not yet — the picture is mixed. Some indicators show easing pressure, others point to slowing demand and rising unemployment, especially for younger workers. In this article I’ll walk through the latest hiring data, explain what it means for different groups, and give practical takeaways for jobseekers and recruiters.

I draw primarily on the latest releases from the national statistics body and leading labour-market monitors, plus sector surveys and job-posting indexes.The headline: vacancies are down from their pandemic highs, hiring activity is softening in many sectors, but wages are still rising — creating a complicated environment that looks more like “slow stabilisation” than a clear recovery.

Quick snapshot: the numbers you need to know

  • Unemployment rate: around 5.2% (recent ONS releases).

  • Total vacancies: down sharply year-on-year — roughly 695–695k advertised jobs in January, the lowest since the pandemic-era peaks.Vacancy counts are down double digits compared with last year in many measures.

  • Job postings (online index): down roughly 10–20% vs pre-pandemic baselines, depending on the provider. HiringLab and Indeed indexes show postings remain well below pre-pandemic levels.

  • Youth unemployment and NEETs: sharp deterioration — youth joblessness is notably higher, with young people (late teens to mid-20s) hardest hit.

  • Starting pay / advertised salaries: still rising, with advertised salaries outpacing headline inflation in some measures.

These numbers suggest a labour market that is looser than a year ago — more people looking for work, fewer vacancies — but one where pay remains elevated due to previous shortages, sectoral mismatches and cost pressures on employers.

What the official data says: the Office for National Statistics view

The latest uk news24x7 labour market releases from the Office for National Statistics show that while employment levels remain near recent peaks, unemployment has ticked up and inactivity remains stubbornly high in some groups.The ONS’s February 2026 bulletins reported an increase in unemployment and slower growth in employment compared with previous quarters. The number of vacancies fell year-on-year in most sectors, with a particularly sharp decline in construction and some resource industries.

Why that matters: the ONS is the gold standard for headline labour statistics used by government and markets. A rise in unemployment alongside falling vacancies signals that demand for labour is cooling faster than workers are being absorbed back into jobs — a classic indicator that the market is easing, not heating up.

Recruitment surveys and job-posting indexes: hiring is softening, cautiously

Monthly recruitment surveys and job-posting trackers give a higher-frequency picture than quarterly ONS data.Two useful indicators:

  • The KPMG and Recruitment & Employment Confederation (REC) Report on Jobs showed a softening in permanent placements at the start of 2026, though temp billings ticked up slightly — pointing to employers hedging with short-term hires rather than long-term commitments. Recruiters reported vacancies falling for the 27th consecutive month, but the pace of decline eased slightly in January.

  • Online job-posting indexes such as those published by HiringLab (and Indeed’s trackers) report job ad volumes still below pre-pandemic baselines and down year-on-year — a read that underlines weaker hiring demand across many occupations.