UK unemployment sees surprise fall in February

21st Apr 2026 07:07

(Sharecast News) - UK unemployment unexpectedly fell in February, official data showed on Tuesday, while wage growth continued to slow.

According to the Office for National Statistics, the unemployment rate in the three months to February was 4.9%, down from January's 5.2%. Consensus had been for no change.

The number of payrolled workers was broadly flat, which the ONS said reflected ongoing weak hiring.

Liz McKeown, director of economic statistics at the ONS, added: "Vacancies fell to their lowest level in almost five years, but with unemployment also falling, the number of vacancies per unemployed person remains broadly unchanged."

Average earnings excluding bonuses, meanwhile, grew by 3.6% over the same period, the lowest increase since November 2020. The rate was down on the previous month's 3.8% uplift although it was higher than forecasts for a 3.5% increase.

Including bonuses, and average earnings grew by 3.8%, down from January's 4.1% rise.

Annual regular earnings growth was 5.2% in the public sector, compared to a more modest 3.2% across private companies.

Kathleen Brooks, research director at XTB, said: "Overall, a drop in the unemployment rate is good news for the UK economy. The ONS has said that the labour market survey remains subject to revision, so the market is likely to take today's data with a pinch of salt, even though it is another sign that the UK economy strengthened just before the energy price shock."