UK Labour Market (Mar/Apr) Rain after the sunshine

Research evidence excerpt

UK Labour Market (Mar/Apr) Rain after the sunshine

19 May 2026

UK Labour Market (Mar/Apr) EconomicsData Reactions-

Rain after the sunshine United Kingdom

◆ UK jobs numbers for March and April were weak across the board, with the Elizabeth Martins

headline rate of unemployment rising to 5.0% (consensus: 4.9%)… SeniorHSBC BankEconomist,plc UK

liz.martins@hsbc.com

◆ … and a 100k drop in payrolled employment in April which, if confirmed, would +44 20 7991 2170

be the biggest monthly fall since May 2020

◆ Meanwhile regular pay growth slowed further, making this a broadly dovish

release for a conflicted Bank of England

Facts

Jobs: New Year optimism fading fast

The UK headline unemployment rate rose to 5.0% in the three months to March (consensus: 4.9%) (chart

1).

While the LFS employment indicator did point to a decent rise in employment in Q1 (+148k), this largely

reflected a strong January and February, with a fall in employment recorded in March itself on a single

month basis.

The PAYE employment measure dropped 100k in April. This series is subject to heavy revision, but if

confirmed, this would be the biggest drop since May 2020. The measure has fallen in six of the last eight

months, with a brief respite in December and January.

By sector, hospitality and construction saw the biggest falls, while energy and finance saw the biggest

increases (chart 2).

Meanwhile, vacancies continued to fall as well, and were down 3.9% 3m/3m in the three months to April,

standing at their lowest point since

The silver lining is that the redundancy rate remains relatively low and has retreated from earlier highs

(chart 3). So this seems to be a narrative of “no hire, no fire”, similar to those seen else in the US and

elsewhere.

But pay still slowing gradually