The number of PAYE employees has stabilised, whilst average pay increased from the previous year, data from the Office for National Statistics shows.
The statistics published this morning indicate that the number of payrolled employees in February 2025 broadly stayed the same. A small increase of 0.2% in employee numbers was registered from the previous year.
The UK employment rate for those aged 16 to 64 years old was estimated at 75% between November 2024 and January 2025, whilst the unemployment rate for people aged 16 years and over was estimated at 4.4% in the time period. This rate is above that registered a year before.
In the health and social work sector, 92,000 more people were employed between February 2025 than the previous year. Conversely, employee numbers in the accommodation and food service activities sector fell by 64,000 people.
In February, the highest number of employees in the UK were in Birmingham, at 465.7k. This was followed by Leeds (371.9k) and Glasgow City (274.7k). Birmingham and Leeds saw an increase in employee numbers whilst Glasgow registered a small decrease from the previous year.
Additionally, in the UK, mean monthly pay increased by 5% between January 2025 and 2024. In January, mean pay was highest in London areas. In Kensington and Chelsea, employees were earning, on average, £14k per month. Mean pay was lowest in Leicester (£2,210), Kingston upon Hull (£2,230) and Blackpool (£2,236).
In February 2025, median pay saw an increase of 9.3% in the food service and activities sector and a decrease of 2.1% in the finance and insurance sector. This was also highest in London areas, particularly in the City of London (£5,931) and in Wandsworth (£3,748).
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Neil Carberry, chief executive officer at Recruitment and Employment Confederation: “Business and government must work together to get more people into the workforce sustainably. But that has to start with helping business to hire people on whom they are taking a chance. Welfare reform is one part of that, but so is tackling barriers to hiring people on potential. Addressing the design of the Employment Rights Bill to build firm confidence in taking a chance on someone and getting skills right with a focus on learners and their employers should both be priorities if we are to pick up pace.”
Seemanti Ghosh, principal economist at the Institute for Employment Studies: “Today’s figures continue to disappoint and raises immediate wider policy concerns. At a time when employers are already adjusting business plans to address anticipated cost increases, the economy remains sluggish. […] This is an urgent call for the government to bring forward activation of the growth plan to ‘Get Britain Working’ to support the proposed changes to the welfare system to work effectively.”
Alex Hall-Chen, principal policy advisor for employment at the Institute of Directors: “Despite a small increase in payrolled employees, the continued decline in job vacancies and increase in the unemployment rate reflect weak business hiring intentions as a result of the Government’s employment reforms.”
“The Government’s Better Regulation Action Plan is a welcome shift in narrative, but such commitments will ring hollow if the principles are not first applied to its plans to increase the regulation and cost associated with employing staff.”
Ben Harrison, director of the Work Foundation at Lancaster University: “In the week that Government launched its Green Paper to create ‘Pathways to Work’ to boost employment levels in the UK, today’s data reveals that while the labour market may be stabilising, a number of stubborn challenges remain.”