Unemployment has risen and wage growth is slowing in the UK, according to the Office for National Statistics.

The non-ministerial department has released its latest quarterly figures on the state of the UK economy, finding that unemployment had risen to 4.4%, up 0.2% from the last quarter and 0.4% over the last 12 months.

In Scotland the unemployment rate was 4.9%, up 0.8% on the last quarter and 1.6% over the past year.

The ONS also provides figures for those who are 'economically inactive', which it defines as "people not in employment who have not been seeking work within the last four weeks and/or are unable to start work within the next two weeks".

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For the UK as a whole that figure was 22.1% in the last quarter, a drop of 0.1%, while in Scotland it was 23.3%, up 0.6%.

However, over a 12 month period the UK number rose 0.8%, higher than the 0.4% for Scotland.

In March to May 2024, the highest unemployment rate was in the East Midlands (5.6%) and the lowest was in Northern Ireland (2.0%).

The ONS said average regular earnings growth dropped to 5.7% in the three months to May – down from 6% in the previous three months and the lowest level since the quarter to September 2022.

With Consumer Prices Index (CPI) inflation taken into account, regular earnings rose by 3.2%, which is the highest since the three months to August 2021.

The ONS also warned that the employment sector is 'cooling', with 30,000 fewer vacancies at 889,000 in the quarter to June.

Liz McKeown, ONS director of economic statistics, said: “Earnings growth in cash terms, while remaining relatively strong, is showing signs of slowing again.

“However, with inflation falling, in real terms it is at its highest rate in over two-and-a-half years.

“We continue to see overall some signs of a cooling in the labour market, with the growth in the number of employees on the payroll weakening over the medium term and unemployment gradually increasing.

“The number of job vacancies is down across most sectors, led by retail and hospitality. The total has now been falling for a full two years, though it remains above pre-pandemic levels.”

Deputy First Minister and Cabinet Secretary for Economy and Gaelic Kate Forbes said: “While people are continuing to struggle with the ongoing effects of the cost of living crisis, this data shows strong growth in earnings. Median monthly pay was £2,413 in June 2024, up 5.2% from last year.

"This outpaced inflation and median monthly pay across the UK, putting more money back into the pockets of Scottish workers, while our claimant count rate was below the UK as a whole. 14,000 more workers entered payrolled employment over the year, which put the number of payrolled employees in Scotland at 2.47 million in June 2024 - the highest level on record.

“The First Minister has been clear that driving growth is a key priority and we welcome that the new UK Government is also committed to sustained economic growth. I look forward to working constructively with UK Ministers to achieve this.

“But growth also needs people with the right skills and experience and key sectors of the Scottish economy continue to be harmed by Brexit and the loss of freedom of movement.

“While we will continue to work closely with businesses and industry to give more people who are currently not economically active more opportunities in training and work, and to address current skills gaps from within our current population, we also need more people to come to live and work in Scotland. That is why we have launched Scotland’s Migration Service to attract workers with the right skills.”

Scottish Secretary Ian Murray said: "These worrying figures reflect the economic situation this government has inherited, but we’re wasting no time to deliver change for people across the UK.

“Just this week in the King’s Speech, the government outlined a raft of bills to unlock growth and deliver the biggest upgrade of workers’ rights in a generation.

“We want to create more jobs in Scotland – but crucially good jobs, with secure hours and fair pay. That’s why resetting the relationship between Scotland’s two governments, working together and delivering better outcomes for the people in Scotland, has been a priority for myself and the Prime Minister.”