Job vacancies across the United Kingdom dropped to their lowest level in more than five years during the third quarter of 2026, driven primarily by smaller firms pulling back on recruitment amid rising operating expenses.
Figures released by the Office for National Statistics showed that vacancies declined by 21,000 in the three months to September, bringing the total down to 691,000. It marks the sharpest decrease in openings recorded since the beginning of the year, with construction suffering the steepest downturn.
Employers pointed to growing labour costs as a key factor in limiting recruitment. Companies have highlighted higher National Insurance contributions and increases to the minimum wage, alongside surging energy bills linked to the war in Iran, as major drivers behind the increased expense of retaining and hiring staff.
David Freeman, the deputy director of labour market statistics at the ONS, said: "The number of vacancies has seen its largest fall since the start of the year, concentrated mainly within smaller businesses, which cite increased labour costs as a key factor."
Despite the decline in job postings, the wider labour market showed mixed indicators. The UK unemployment rate fell to 4.7% in the three months to August, down from 4.9% in the prior reporting period. Meanwhile, average earnings excluding bonuses rose by 3.7%, translating into real wage growth of 0.8% after adjusting for inflation.
However, youth joblessness remained elevated. The unemployment rate for people aged 16 to 24 stood at 15.6% between June and August. Although this represented an improvement from 16.4% in the March-to-May quarter, it remained above the 14.6% recorded during the same period in 2025.
Pat McFadden, the Secretary of State for Work and Pensions, said the overall figures "show the resilience of our labour market" despite international pressures, but acknowledged that "too many young people still find themselves locked out of employment." He added that the government is collaborating with industry to help younger workers enter employment and avoid long-term reliance on the welfare system.
