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The unemployment rate in the United Kingdom, at 4.4% in March 2024, has increased by 0.5 percentage points over the course of the preceding year. It nevertheless remains half a percentage point below the OECD average. Participation and employment rates have fallen back somewhat over the course of the year falling 0.6 and 0.9 percentage points respectively. The United Kingdom is one of only three OECD countries – alongside Colombia and Costa Rica – in which the labour force participation rate remains below its pre‑COVID‑19 level by more than a percentage point. Participation rates among youth (aged 15‑24) are 4 percentage points below pre‑crisis rates. The OECD projects GDP growth will remain sluggish at 0.4% in 2024 before improving to 1.0% in 2025. Unemployment is predicted to continue increasing and reach 4.7% in 2025 as the labour market cools.

In March 2024 the government announced a 2‑pence cut to the rate of National Insurance Contributions (NICs) – both for employee and self-employed rates. These cuts come on the back of similar cuts in November. Despite these cuts, overall tax liability on income has increased for those at both the high and the low end of the income distribution, as a result of a multi-year freeze in income tax thresholds.