UK unit labour costs index
UK unit labour costs index stood at 114.5 in Q1 2026, according to Office for National Statistics (ONS). It is one of the indicators in the Jobs by industry and sector table (Value · Quarterly), with a complete series running from Q1 1955 to Q1 2026. The complete series with an interactive chart, free to download.
This indicator in the Jobs by industry and sector table
| Indicator | Q1-2026 | Q4-2025 | Q3-2025 | Q2-2025 | Q1-2025 | Q4-2024 | Q3-2024 | Q2-2024 | Q1-2024 | Q4-2023 | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Unit labour costs (2023=100) | 114.5 | 112.7 | 111.7 | 109.5 | 108.9 | 107.9 | 105.6 | 103.6 | 103.1 | 101.2 | |
| Unit wage costs (2023=100) | 112.2 | 111.1 | 110.2 | 108.7 | 108.6 | 107.7 | 105.7 | 103.7 | 102.7 | 101.1 | |
| Unit labour costs, annual change | 5.2 | 4.5 | 5.8 | 5.7 | 5.6 | 6.6 | 4.8 | 3.7 | 5 | 4.4 |
Understanding UK unit labour costs index
The total cost of labour incurred to produce a unit of real output across the entire economy of the United Kingdom is indexed against a fixed base year. This metric relates aggregate labour compensation, including wages and employer social contributions, to total real gross value added. Unlike direct wage measures, unit labour costs capture the vital interaction between employee remuneration and productivity performance, serving as a primary indicator of domestic inflationary pressure originating from the labour market.
Interpreting this index requires recognising that productivity drops can drive up unit costs even when wage settlements remain moderate. Preliminary figures are subject to regular revision as both National Accounts output data and compensation estimates are refined. Period-on-period movements can be erratic, so analysts frequently examine annual changes to discern genuine cost trends. When comparing this series with consumer price indices, analysts should note that labour costs measure producer-side pressures that feed into retail prices with a variable time lag.
Frequently asked questions
- What components make up the labour compensation used in this calculation?
- Gross wages, salaries, and employer-paid social security contributions are all factored into total labour compensation.
- How can productivity declines cause this index to rise?
- If worker output falls while pay remains constant, the labour cost required to produce each unit of output increases.
- Why are early estimates of unit labour costs often revised?
- They depend on preliminary national accounts data for both economic output and employee compensation which receive later updates.