• Summary of key points
  • Payrolled employees
  • Employee pay and inflation
  • Additional payrolled employee statistics
  • Employment rate
  • Unemployment rate
  • Economic inactivity rate
  • Online job postings
  • Claimant count
  • Summary of headline indicators
  • Measuring the labour market



Labour market conditions were little changed in the latest quarter, according to Office for National Statistics (ONS) data.


While pay growth continues to be robust, unemployment remains at elevated levels and the number of payrolled employees in London continued to drift lower from the high-point in mid-2024.


That softness includes falling job numbers in some of London’s key industries including IT, hospitality and construction, which have all seen declines of over 3% in the last year.


Note that, due to recent data volatility, we adopt ONS’ prudent language when reporting quarterly changes of the employment rate, unemployment rate and inactivity rate. The focus should be on the general movements rather than the exact figures. As data collection improvements feed into published results, there is a possibility of further revisions. This report uses several data sources and indicators, which need to be taken together to get a reliable picture of London’s labour market.


Summary of key points


  • The most timely estimate of payrolled employees (subject to revision) shows a fall of 15,900 (-0.4pp) in the number of payrolled employees in London between March and April 2025, and a decrease of 0.9% on the year.

  • The employment rate in London was estimated at 74.2% for the three months ending March 2025, a decrease of 0.3pp on the same period in the previous year, and a fall on the quarter. London’s employment rate was lower than the UK average (75.0%).

  • London’s unemployment rate was estimated at 6.2%, up on the quarter and an increase of 1.6pp from a year earlier. The UK average was 4.5%.

  • London’s inactivity rate (the measure of those not looking and/or not available to work) was estimated at 20.7%. This was a fall of 1.1pp on the previous year, and a fall on the quarter. It is lower than the UK-wide estimate of 21.4%.



Payrolled employees


The count of payrolled employees from HMRC’s Pay As You Earn (PAYE) RTI dataset offers a timely measure of labour market trends:

  • Early estimates indicate that there were around 4.3 million payrolled employees living in London in April 2025, a fall of 15,900.

  • The latest London estimate represents a decrease of 37,700 (0.9%), on the previous year (April 2024) compared to a decrease of 0.3% UK-wide.

  • Relative to pre-pandemic (February 2020) levels, the number of payrolled employees in London was up by 214,000, or 5.2%. This compares to an increase of 4.3% across the UK.

The figures for April 2025 in the RTI dataset are provided to give an indication of the likely level of employees as well as median pay in the latest period. They are of lower quality and may be subject to significant revision in future releases.

Back to top

Jan 16Jan 17Jan 18Jan 19Jan 20Jan 21Jan 22Jan 23Jan 24Jan 253,800,0004,000,0004,200,0004,400,000
Payrolled employees in London​Latest data for April 2025​

Source: HM Revenue and Customs – Pay As You Earn Real Time Information.

Note: Estimates are based on where employees live. March 2020 indicated by dotted line.


-1.1%-1.5%-0.9%-0.4%-0.4%-0.9%-0.3%InnerLondon -WestInnerLondon -EastOuterLondon -West andNorth WestOuterLondon -East andNorth EastOuterLondon -SouthLondonUK-2%-1%0%1%2%
Payrolled employees, change on previous year by NUTS2 region​Latest data for April 2025​

Source: HM Revenue and Customs – Pay As You Earn Real Time Information.

Note: Estimates are based on where employees live.

-0.2%-0.2%-0.9%-0.4%-0.3% 1.1%-0.5%-0.3%-0.2%-0.3%-0.3%-0.4%-0.3%LondonScotlandNorthEastWestMidlandsYorkshireand TheHumberWalesSouthEastNorthWestEastMidlandsSouthWestEastNorthernIrelandUK-1%0%1%
Payrolled employees, change on previous year by NUTS1 region​Latest data for April 2025​

Source: HM Revenue and Customs – Pay As You Earn Real Time Information.

Note: Estimates are based on where employees live.


Employee pay and inflation


The RTI dataset also provides information on the nominal monthly pay of payrolled employees living in London. This can be adjusted for inflation to estimate real pay over time.

CPIH (consumer price inflation including owner-occupiers’ housing costs) is a national measure and does not account for region-specific price changes.



The median pay is an average which measures the middle point in the range of recorded monthly employee salaries.

In April 2025:

  • Median monthly pay in London was £2,960, an increase of 5.7% on the year.

  • In the UK overall, median pay was £2,520, up by 6.4% on the year.

Back to top

Jan 2015Jan 2016Jan 2017Jan 2018Jan 2019Jan 2020Jan 2021Jan 2022Jan 2023Jan 2024Jan 2025£2,000£2,500£3,000
London, nominalUK, nominalMedian monthly employee pay​Nominal pay to April 2025 not adjusted for inflation​

Source: HM Revenue and Customs – Pay As You Earn Real Time Information.

Note: Estimates are based on where employees live. March 2020 indicated by dotted line.



The change in median nominal salary on the year varies between the regions and countries of the UK.

From April 2024 to April 2025:

  • South East was the region/country with the lowest growth in median monthly salary at 5.5%.

  • The region/country with the highest growth in median monthly salary was Northern Ireland at 10.9%.

Back to top

SouthEastLondonWalesEastScotlandNorthEastNorthWestWestMidlandsSouthWestEastMidlandsYorkshireand TheHumberUKNorthernIreland0%2%5%8%10%12%
Median monthly pay by region, change (%)​Change on year, April 2025​

Source: HM Revenue and Customs – Pay As You Earn Real Time Information.

Note: Estimates are based on where employees live.



Growth in real wages can be estimated by adjusting nominal pay for the rate of inflation, here CPIH, giving a better idea of how much wages progress in relation to the cost of living.

In March 2025, the latest month for which CPIH inflation data is available:

  • The year-on-year CPIH rate in the UK was 3.4%.

  • Nominal employee pay was up by 5.3% on the year in London, resulting in an increase of 1.9% in real pay on the year.

Back to top

Jan 2020Jan 2021Jan 2022Jan 2023Jan 2024Jan 2025-10%-5%0%5%10%15%
Nominal payCPIHReal payDecomposition of real median pay in London, % annual change​Effect from nominal pay change and CPIH inflation, to March 2025​

Source: HM Revenue and Customs – Pay As You Earn Real Time Information, ONS.

Note: March 2020 indicated by dotted line. Inflation measure does not account for region-specific price changes. Sign of inflation rates has been reversed (higher inflation rates are associated with lower real pay growth). Inflation data is released after pay data and is not available for the most recent month.



Annual growth rates are a backward-looking measure that indicate the cumulative impact of changes over the previous year. This is an important measure that shows how much wages, or prices have changed in total over the last year.

However, it is also important to understand how fast things are changing at the present time. To do this we show annualised growth rates that measure how fast prices and pay have changed over the last three months.

Using the three-month period January 2025 to March 2025, we estimate the annualised growth rate of real pay in London to be 3.1%.

Back to top

Jan 2019Jan 2020Jan 2021Jan 2022Jan 2023Jan 2024Jan 2025-10%0%10%20%
12 month change3 month annualisedYearly change in payrolled employees real pay, London (%)​Latest data to March 2025​

Source: HM Revenue and Customs – Pay As You Earn Real Time Information, ONS.

Note: March 2020 indicated by dotted line. Inflation measure does not account for region-specific price changes.


Additional payrolled employee statistics


The tabs below are each updated once per quarter, as new data is released by the ONS/HMRC. This month’s release contains new data on the number of payrolled employees by industry sector. Previous releases of changes by age group and local authority are also included for reference.



Comparing April 2025 to the same time last year:

  • Transport & storage saw the highest percentage growth in payrolled employees at 2.0%, followed by Health (1.9%) and Finance & insurance (1.6%).

  • Hospitality saw its number of payrolled employee jobs fall, with a decrease of 4.4%, followed by Information & communication (down by 3.3%) and Construction (down by 3.1%).

Back to top

-5%-2%0%3%HospitalityInformation & communicationConstructionAdministrationProfessional servicesOther servicesRetailManufacturingEducationReal estateArts & recreationPublic admin & defenceFinance & insuranceHealthTransport & storageTotal
LondonUKPayrolled employees, change on the year by selected sector​Latest data for April 2025​

Source: HM Revenue and Customs – Pay As You Earn Real Time Information.

Note: Estimates are based on where employees live. Excludes sectors with fewer than 25,000 payrolled employees in London.



Recent changes in the number of payrolled employees vary by age group. Comparing March 2025 to levels the previous year:

  • The number of employees “Aged: 18-24” was down by 4.0%. This fall is much larger than the UK’s.

  • The number of employees aged 25-34, 35-49 and 50-64 changed only slightly over the year in London.

  • In London and the UK, we see a rise in the number of payrolled employee jobs held by people aged 65+, though they represent only a small share of the total.

Back to top

Aged: 18-24Aged: 25-34Aged: 35-49Aged: 50-64Aged: 65+Total-10%-5%0%5%10%
LondonUKPayrolled employees, change on the year by age group​Latest data for March 2025​

Source: HM Revenue and Customs – Pay As You Earn Real Time Information.

Note: Estimates are based on where employees live.



There is considerable variation in the change in payrolled employees by London local authority. Comparing February 2025 with levels the year before:

  • The number of payrolled employees living in Barking and Dagenham, the borough (incl. the City) with the highest growth, was up by 2.2% on the year.

  • The borough with the lowest growth (excl. the City), Westminster, recorded a decrease of 2.3%.

  • The boroughs gaining resident payrolled employment tend to be Outer London boroughs. On the other hand, the falls are heaviest in Inner London.

Back to top

+−
Change since
February 2024 (%)
-4% to -2%
-2% to 0%
0% to 2%
2% to 4%
Leaflet

Source: HM Revenue and Customs - Pay As You Earn Real Time Information. Contains Ordnance Survey data Crown copyright and database rights [2015].

Note: Estimates are based on where employees live.



Employment rate


Employment measures the number of people aged 16 and over in paid work and those who had a job that they were temporarily away from (for example, because they were on holiday or off sick). The employment rate is the proportion of people aged between 16 and 64 years who are in employment.

Note: because of the volatility and uncertainty in Labour Force Survey estimates highlighted by ONS, we do not report on quarterly changes in employment, unemployment and inactivity rates, only the direction. In addition, ONS revised its main labour market survey data based on revised population estimates in December 2024, bringing its employment estimates closer to other data sources, as explained in detail in our December 2024 release, meaning that recent employment fluctuations need to be taken particularly cautiously.

For January to March 2025:

  • The 16-64 employment rate in London was estimated at 74.2%; this represents a decrease of about 0.3pp from a year earlier, and a small fall on the quarter.

  • The margin of error for the London employment rate is ±1.6%, which suggests that the oscillations over the last two years between around 74% to around 76% do not reflect a significant change in the underlying trend.

  • The overall UK employment rate was estimated at 75.0%, an increase of 0.5pp on the year, and a small rise on the quarter.

Back to top

Jan 2015Jan 2016Jan 2017Jan 2018Jan 2019Jan 2020Jan 2021Jan 2022Jan 2023Jan 2024Jan 202570%72%74%76%78%
LondonUnited KingdomEmployment rate (% of working age population)​Latest data for three-month period ending March 2025​

Source: ONS Labour Force Survey.

Note: The margin of error is ±1.6% for London and ±0.5% for the UK. The LFS has been reweigted from July to September 2022 onwards. September 2022 indicated by dotted line.


UnitedKingdomNorthEastWalesNorthernIrelandYorkshireand TheHumberWestMidlandsNorthWestLondonScotlandEastMidlandsEastSouthEastSouthWest0%20%40%60%80%
Employment rate by region (% of working age population)​Latest data for three-month period ending March 2025​

Source: ONS Labour Force Survey.

Note: The margin of error ranges from ±1.4% to ± 2.7% across regions.


Unemployment rate


Unemployment measures people without a job who have been actively seeking work within the last four weeks and are available to start work within the next two weeks. The unemployment rate is the proportion of the economically active population who are unemployed.

Note: because of the volatility and uncertainty in Labour Force Survey estimates highlighted by ONS, we do not report on quarterly changes in employment, unemployment and inactivity rates, only the direction.

For January to March 2025:

  • The unemployment rate for London was estimated at 6.2%. This represents an increase of 1.6pp from a year earlier, and a small rise on the quarter.

  • The UK unemployment rate was estimated at 4.5%,an increase of 0.2pp on the year, and also up on the quarter.

  • The unemployment rate in London remained the highest across all regions/countries of the UK.

Back to top

Jan 2015Jan 2016Jan 2017Jan 2018Jan 2019Jan 2020Jan 2021Jan 2022Jan 2023Jan 2024Jan 20250%2%4%6%8%
LondonUnited KingdomUnemployment rate (% of economically active)​Latest data for three-month period ending March 2025​

Source: ONS Labour Force Survey.

Note: The margin of error is ±1.0% for London and ±0.3% for the UK. The LFS has been reweigted from July to September 2022 onwards. September 2022 indicated by dotted line.


UnitedKingdomNorthernIrelandSouthWestNorthWestSouthEastEastMidlandsScotlandEastWestMidlandsYorkshireand TheHumberNorthEastWalesLondon0%2%4%6%
Unemployment rate by region (% of economically active)​Latest data for three-month period ending March 2025​

Source: ONS Labour Force Survey.

Note: The margin of error ranges from ±0.7% to ±1.5% across regions.


Economic inactivity rate


The economic inactivity rate is the proportion of 16 to 64 year olds not in work and either not looking for or unable to work. The main categories in this group are students, people who are looking after family/home full-time, and people who cannot work for health reasons (most of whom are long-term sick).

Note: because of the volatility and uncertainty in Labour Force Survey estimates highlighted by ONS, we do not report on quarterly changes in employment, unemployment and inactivity rates, only the direction.

For January to March 2025:

  • The rate of economic inactivity in London was estimated at 20.7%. This represents a decrease of 1.1pp from a year earlier, and a small fall compared to the previous quarter.

  • The UK rate of economic inactivity was 21.4%. This represents a decrease of 0.7pp on the year, and a small fall on the quarter.

Back to top

Jan 2015Jan 2016Jan 2017Jan 2018Jan 2019Jan 2020Jan 2021Jan 2022Jan 2023Jan 2024Jan 202515%18%20%22%25%
LondonUnited KingdomEconomic inactivity (% of working age population)​Latest data for three-month period ending March 2025​

Source: ONS Labour Force Survey.

Note: The margin of error is not published for London, the UK margin is ±0.3%. The LFS has been reweigted from July to September 2022 onwards. September 2022 indicated by dotted line.


UnitedKingdomSouthWestEastSouthEastLondonEastMidlandsScotlandNorthWestWestMidlandsYorkshireand TheHumberWalesNorthernIrelandNorthEast0%10%20%30%
Economic inactivity rate by region (% working age population)​Latest data for three-month period ending March 2025​

Source: ONS Labour Force Survey.

Note: The margin of error is not published for regions.


Online job postings


The number of online job postings is an indicator of the demand for labour in London. It is very timely and complements more traditional employment indicators.

We use online job postings data provided by Lightcast. Given the volatility associated with single-month estimates, the three-month average estimates provide a more reliable indication of short-term changes in the demand for labour.

  • Latest job posting estimates suggest there were about 115,000 online postings for jobs in April 2025 (single-month estimate). This was a fall of around 2% compared to the 117,000 postings observed in April 2024, and an increase of around 8,000 (7%) on the month.

  • The three-month average for March 2025 was about 105,000 postings. That is its highest level since August 2024 and although it is still well below its post-pandemic high of about 216,000 in Mach 2022, it is around the same as it was in 2019.

Back to top

Jan 2020Jan 2022Jan 202450,000100,000150,000200,000
3 months rolling averageNumber of unique job postingsOnline postings for jobs in London​Number of unique postings​

Source: Lightcast.

Note: Data not seasonally adjusted. March 2020 indicated by dotted line.


Claimant count


The Claimant Count is a measure of the number of people claiming benefits principally for the reason of being unemployed. It includes people claiming Jobseeker’s Allowance and those claiming Universal Credit who are required to seek work.

Note that Claimant Count numbers for the period May 2024 to November 2024 were affected by the rollout of a higher administrative earnings threshold for full work-search conditionality. This change would have raised the number of claimants and raised year-on-year increases in the claimant rate.

The latest data for April 2025 show that:

  • There were 359,000 people claiming unemployment-related benefits in London - equal to a seasonally adjusted claimant rate (as a proportion of residents aged 16 to 64) of 5.8%. The number of claimants in London was 59,100 higher than a year earlier.

  • The age group with the biggest percentage rise in the number of claimants, in both London and the UK, was those aged between 45 and 49.

  • Up until the early months of the Covid-19 pandemic, London’s claimant rate was in line with the UK’s. The gap opened then, and has not closed since. The UK’s claimant rate was 4.1% in March 2025.

Back to top

Jan 2015Jan 2016Jan 2017Jan 2018Jan 2019Jan 2020Jan 2021Jan 2022Jan 2023Jan 2024Jan 20250%2%5%8%10%
LondonUnited KingdomClaimant count (as a % of residents aged 16 to 64)​Latest data for period April 2025​

Source: ONS Claimant Count by sex and age (seasonally adjusted).

Note: may include some employed claimants on low hours or earnings. September 2022 indicated by dotted line.


Allcategories:Age 16+Aged16-24Aged25-29Aged30-34Aged35-39Aged40-44Aged45-49Aged50-54Aged55-59Aged60-640%10%20%30%40%
LondonUnited KingdomYear-on-year percentage change in claimant count​Latest data for period April 2025​

Source: ONS Claimant Count by sex and age (not seasonally adjusted).

Note: may include some employed claimants on low hours or earnings.


Summary of headline indicators


Back to top


Measuring the labour market


The ONS has published its latest labour market update covering Labour Force Survey (LFS) data for the three months ending March 2025 and real-time information (RTI) data up to April 2025. This bulletin presents the latest headline labour market estimates for London.

Please note:

  • Many of the statistics presented here are estimates based on surveys, and as such have a margin of error – known as sampling variability.

  • They also cover different reference periods or count dates.

More information and previous GLA Economics analyses can be found on our labour market analysis page.

More information on the data used and a glossary of terms can be found on the ONS website.

Back to top