Welsh jobs market remains resilient despite fall in vacancies, ministers say

Nation.Cymru staff

The number of job vacancies across the UK has fallen to its lowest level in more than five years, but Welsh Government ministers have pointed to broader evidence suggesting Wales’ labour market remains relatively strong.

New figures published by the Office for National Statistics (ONS) show vacancies across the UK dropped by 19,000 in the three months to May to 707,000 – the lowest level since spring 2021. Employers have cited economic uncertainty and rising labour costs as reasons for slowing recruitment.

However, the Welsh Government has urged caution when interpreting headline labour market figures, highlighting ongoing concerns about the reliability of some survey data and pointing to alternative measures showing employment in Wales remains close to record levels.

In a response to the latest statistics, ministers said evidence from a range of sources suggested the Welsh labour market was following a similar trend to the wider UK.

The Welsh Government said: “As a newly elected Government we are committed to driving investment, innovation and higher productivity across Wales.

“We have announced a National Productivity Goal to close the gap with the rest of the UK and help unlock the full potential of the Welsh economy.

“By focusing on productivity, we will deliver more jobs, higher pay, stronger businesses and thriving communities.”

The statement comes after Wales’ Chief Statistician, Stephanie Howarth, warned earlier this year that Labour Force Survey (LFS) data should not be viewed in isolation because response rates remain below pre-pandemic levels despite improvements made by the ONS.

In an April update, the Chief Statistician said recent interventions had improved the reliability of the survey but that estimates for Wales continued to show greater volatility and wider confidence intervals than before the pandemic. The report noted that employment and unemployment trends derived from the survey had diverged from other official measures, including HMRC payroll data.

The Welsh Government continues to recommend using a range of indicators, including workforce jobs data, claimant counts and HMRC payroll figures, to assess the health of the labour market.

Those alternative measures paint a more positive picture. According to the Annual Population Survey, there were 1.47 million people in employment in Wales in the year to December 2025, an increase of 5,500 on the previous year and a figure described as relatively close to an all-time high. Wales’ employment rate for people aged 16 to 64 was also 3.2 percentage points higher than in 2004.

The latest Annual Population Survey figures show Wales’ unemployment rate at 4.5%, compared with 4.4% across the UK.

Ministers also revealed that Cabinet Secretary for Enterprise, Connectivity and Energy, Adam Price, is seeking discussions with the ONS over the reliability of labour market statistics for Wales.

Payroll employment

Across the UK, the ONS said payroll employment fell by 53,000 in April to 30.3 million, while vacancies continued to decline across most sectors. Retail and hospitality recorded some of the largest annual falls, reflecting pressure from higher wage bills and increased National Insurance costs.

ONS director of economic statistics Liz McKeown said employers were becoming “more cautious about taking on new staff”, with some firms putting recruitment plans on hold because of economic uncertainty and rising labour costs.