The UK Job Market Predictions for 2025
The UK Job Market Predictions for 2025
The UK job market has seen relatively low unemployment for a number of years. As of writing the UK Unemployment rate stands at 4.3%. The lowest is has been this century is 3.7% in July 2022. So by all accounts, despite questionable economic growth and doom and gloom merchants galore, the figure is relatively healthy. December 2011 is not spoken about in grim terms. Ask most people about this periods unemployment rate and I would hazard a guess at a shrug of the shoulders. However, December 2011 had an unemployment rate of 8.4%. 1984 saw 11.8%. Therefore, don’t believe everything the doom and gloom merchants tell you.
Are things about to change though?
Rachel Reeves October 2024 budget and the Labour Government entering power has not been taken well. Businesses are up in arms. The economy is flat. And the wealth divide is growing. A notable point of Reeves budget was a further increase in National Minimum wage. To many people this is seen as a good thing due to the cost of living crisis. But to others it is seen as putting a bandage on a severed jugular.
Around 5% of the UK’s workforce are on National Minimum wage in unskilled roles. The UK’s economic growth over the last 16 years has only increased by 4.3%. However, Inflation has gone up notably, devaluing how far your pounds go. And further more national minimum wages have gone up from £6.50 per hour in 2015 to £12.21 per hour from April 2025. That’s an increase of 188% in just 10 years.
Add to this 9500 millionaires were predicted to have left the UK in 2024, which is double that of the previous year. That’s a lot of taxable revenue leaving the UK, which in turn hits the UK economic outlook even more.
How will all this effect the UK Job Market?
The answer is not great. If you’re an employer who employs many minimum wage workers, unless you fancy going out of business, you’re going to be reducing headcount and replacing low skilled roles with robots and automation as quickly as you can. If you are an employer, then you may be a millionaire. And if you don’t fancy being charged 45% tax, 25% corporation tax, high crime rates, low service levels and things only predicted to get worse, you have options abroad to do business instead. Places like Dubai and Singapore etc will welcome you with open arms.
Conclusion
Companies will need to streamline workforces and focus on quality over quantity. Therefore skilled roles or revenue generating roles will succeed. Low skilled and minimum wage roles will decrease. We will see an increase in unemployment in lower level roles, a greater wealth divide and continued economic stagnation.