UK suffered biggest unemployment surge in G7
UK unemployment rose at a faster pace than any country in the G7, the OECD has said, with a sharp rise in joblessness particularly damaging for the youngest people.
Unemployment levels across the country rose sharply by 0.8 percentage points over the year to 5.2 per cent between the last three months of 2024 and the end of 2025.
It amounts to around 300,000 people going out of work over a 12-month period.
The OECD, the Organisation for Economic Co-operation and Development, found that this rise was steeper than any country across some of the most advanced economies.
France’s unemployment rate rose by 0.6 percentage points, according to the Paris-based think tank, while Germany’s rate increased by 0.5 percentage points.
Unemployment rate surge
The rise in youth unemployment in the UK only trailed France among G7 nations.
The OECD said that the youth unemployment rate in France rose by 1.1 percentage points over the year to 19.7 per cent between 2024 and 2025, compared to a single percentage point difference for the UK.
Economists suggested there was a particularly large rise in the last three months of 2025 as youth unemployment hit 16.1 per cent.
Its new report on the global market said the gap between the unemployment rate for younger and older workers had widened.
Half of the countries in the OECD, which collects data from various major global economies, experienced falling employment rates.
The UK’s employment rate, which covers the number of people in work out of those that are in the working-age population as a whole, inched up slightly.
UK economy’s woes
Unemployment figures comparing the UK to major countries follow a string of reports from both the OECD and the International Monetary Fund (IMF) that have uncovered the country’s economic issues.
The IMF found that the UK’ tax burden would rise at a faster rate than any country in the G7.
The 4.5 percentage point difference, first noted in The Telegraph, in the tax burden compared to when Labour took power in 2024 to the end of the forecast period in 2031 was around three times as large as France’s.
In her first two Budgets as Chancellor, Rachel Reeves raised more than £65bn in taxes in a bid to give public sector workers better pay and shore up public finances.
The IMF separately agreed with the OECD that the UK economy was set to suffer the largest damage to growth and price stability from the war in the Middle East.
A Department for Work and Pensions spokesperson said: “The most recent labour market statistics show there are 388,000 more people in work than there was this time last year. While this is encouraging, we know there is more to do to get people, particularly young people, into work.