The labour market continues to slow, with the largest employment falls seen in retail and hospitality. Pay growth is fastest in those sectors as the rise in the minimum wage takes effect. That, along with rises in national insurance and other changes, may show the pressures employers are facing. Time will tell whether this is an indicator of a broader slowdown or a temporary effect.

In the first quarter of 2025, 2.8 million people of working age were economically inactive due to long-term sickness and this figure has risen by 661,000 since the start of the pandemic. While more than four-in-five people of working age who do not have a disability are employed (81.9%), this is the case for only 54.0% of people with a disability. In the context of a contracting labour market, where the number of redundancies employers are considering making is rising and the number of vacancies is falling, more support is needed to allow those who face barriers to work to gain suitable employment.