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Josh Maratty, policy adviser at the North East Chamber of Commerce, said:
"The ONS employment figures released today (18 August 2026) show that between April and June 2026, the unemployment rate in the North East for people aged 16 and over was 5.4% (compared to 5.7% last month) - now 0.5% higher than the UK average.
Economic inactivity among those aged 16 to 64 was 25.1%, an increase from 24.6% compared with the previous month. The local rate is 4.2% higher than the UK average, underlining the scale of the challenge facing the region.
The employment rate for those aged 16 to 64 fell to 71.1% from 71.5% the previous month, which is now 0.4% lower than the UK average.
UK job vacancies fell to 707,000 in May to July 2026, down 6,000 (0.8%) on the quarter, with the biggest drops in health/social work and education, and small businesses (1-9 employees) hit hardest. Vacancies are also down 19,000 (2.7%) year on year, with declines spread across most sectors. The ratio of unemployed people per vacancy has held steady at 2.5 since mid-2025, following a run of quarterly increases, suggesting the labour market is still soft but has stopped deteriorating further.
The Chamber was present at the Bank of England’s Monetary Policy Briefing hosted by Dr Swati Dhingra, external member of the Monetary Policy Committee at the Bank of England. Dr Dhingra shared her perspective on the current economic climate, monetary policy challenges and the outlook for the UK economy. She said inflation is expected to rise later this year as the economy contends with higher energy prices and ongoing supply chain pressures.
In our recent response to the Government’s Northern Growth Strategy consultation, we argued that devolution cannot simply be about moving responsibilities from Westminster to town halls. It must be accompanied by the financial powers and long-term funding that allow local leaders to plan confidently, invest strategically and deliver lasting growth.
The North East has the ambition, and devolution is already translating into delivery. In Sunderland, Homes England has backed the Sheepfolds neighbourhood with a £27.7m investment, building on the £10m already committed by the North East Mayor. This will help transform the former industrial site into what will become the largest residential neighbourhood within Riverside Sunderland, delivering more than 350 homes.
Meanwhile, the Offshore Renewable Energy Catapult is accelerating innovation and strengthening the offshore wind supply chain across the region, work set to drive further job creation. Together, these projects show what devolution can unlock when combined authorities are trusted with real funding and real decision-making power."
Notes
- Official statistics under review published by the ONS suggest that between April and June 2026, the unemployment rate in the UK for ages 16-64 was 4.9%. In the North East, this was higher at 5.4%.
- The UK’s employment rate for ages 16-64 was 75.1%. In the North East, this was lower, at 71.1%.
- The UK’s economic inactivity rate for ages 16-64 was 20.9%. In the North East, this was higher at 25.1%.
- Vacancies - a significant proportion of roles are never formally advertised, filled instead through networking, internal promotions or direct approaches, and a single job listing can often represent multiple positions. The true number of opportunities available to job seekers is therefore likely to be higher than the statistics alone suggest.
- The ONS continues to use experimental data following issues with data collection, which made employment figures unavailable for a period. For more details on the ONS’ switch from experimental data to official statistics under review, please click here.
Download image of Josh Maratty, policy adviser at the North East Chamber of Commerce, here.
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