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>>Economists caution that Labour Force Survey data may be unreliable as UK unemployment climbs to 5%

Economists caution that Labour Force Survey data may be unreliable as UK unemployment climbs to 5%

crypthub

11/12/2025, 2:20:20 PM

Rising Unemployment Figures

The latest ONS data show unemployment rose to 5% in the three months to September, a 0.2‑point jump and the highest since the pandemic began. The spike prompted opposition MPs and market traders to anticipate a December rate cut and pushed two‑year gilt yields to a one‑year low. Nonetheless, several economists warn the increase may reflect statistical noise rather than a genuine labour‑market weakening.

Questioning Data Accuracy

The Labour Force Survey has faced low response rates and sampling volatility, leading the ONS to pause and later revive its headline figures. Analysts such as Megan Greene of the BoE and economists at RSM and Pantheon note inconsistencies and suggest alternative indicators show a steadier employment picture. Revised tax and payroll data, while showing a drop of around 180,000 jobs after the budget, are also subject to frequent adjustments.

Policy and Market Reactions

Chancellor Rachel Reeves’ first budget, which raised payroll taxes, has drawn criticism from Reform UK and the Conservatives amid concerns over job losses. The BoE is monitoring the labour market closely, with the latest data influencing speculation that a rate cut could arrive in December rather than February. Despite the debate, the reliability of official unemployment numbers remains a key factor for future monetary and fiscal decisions.