North East unemployment rises to 7% as labour market pressures continue
“The ONS employment figures released today (17 February 2026) show that between October and December 2025, the unemployment rate in the North East for people aged 16 and over was 7% (compared to 6.2% last month) – now 1.8% higher than the UK average.”
“Economic inactivity among those aged 16 to 64 was 25.7%, a decrease of 0.3% compared with the previous month. While this still means around one in four working-age adults in the North East is economically inactive, the rate remains 4.9% higher than the UK average, underlining the scale of the challenge facing the region.”
“The employment rate for those aged 16 to 64 fell by 0.2% to 69%, which is now 6% lower than the UK average. This continued softness highlights how fragile progress in the labour market can be and the importance of sustained action to support participation and job creation.”
“Vacancy levels across the UK have broadly stabilised in recent months, with the latest estimates pointing to a marginal increase of 2,000 to 726,000 between November 2025 and January 2026. However, the wider trend remains one of contraction. Vacancies are down 9.2% on the same period a year ago, with falls recorded across 14 of 18 industry sectors. The growing pressure on job seekers is reflected in the ratio of unemployed people to vacancies, which has risen from 1.9 unemployed people per vacancy a year ago to 2.6 today. This means competition for available roles is intensifying and the labour market is becoming increasingly difficult to navigate for those out of work.”
“These figures highlight the scale of the challenge while reinforcing the urgent need to remove the barriers that prevent people from entering and remaining in work. Through our Local Skills Improvement Plans (LSIPs) and ongoing engagement with employers, transport continues to be identified as a key obstacle to economic participation, particularly for those living in more isolated or poorly connected communities.”
“In response, the North East Chamber of Commerce, in partnership with Interdigitate and on behalf of the North East Combined Authority, is leading new regional work to help employers widen access to employment while tackling recruitment challenges. The region faces a dual challenge: persistently high economic inactivity, often linked to health conditions, caring responsibilities or the availability of flexible work, alongside continued recruitment difficulties in key sectors. While good practice exists, fragmented employer engagement across programmes can make it harder for businesses to access support and for individuals facing complex barriers to secure sustainable employment. This trailblazer work represents an opportunity to create more coordinated and effective pathways between employers seeking talent and individuals facing barriers to work.”
“Looking ahead to the Spring Statement, there is hope that the government will prioritise funding that reduces inequality and safeguards the support that helps businesses thrive while protecting the most vulnerable members of society. Tackling economic inactivity is central to unlocking the North East economy – because we are North East business.”
Notes
Official statistics under review published by the ONS suggest that between October and December 2025, the unemployment rate in the UK for ages 16+ was 5.2%. In the North East, this was higher at 7%.
The UK’s employment rate for ages 16–64 was 75%. In the North East, this was lower, at 69%.
The UK’s economic inactivity rate for ages 16–64 was 20.8%. In the North East, this was higher at 25.7%.
The ONS continues to use experimental data following issues with data collection earlier this year and in 2024, 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.