UK unemployment rises as Mideast war hits jobs market

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LONDON: Britain's unemployment rate edged up to 5% in the first quarter of 2026 as the severe economic fallout from the Middle East war began to hit the domestic labor market.

The Office for National Statistics (ONS) reported on Tuesday that the jobless rate increased slightly from the 4.9% recorded in the three months to February. The negative turn in employment reflects the early signs of strain on British employers facing soaring operational costs.

Economists noted that a massive energy shock triggered by the closure of the Strait of Hormuz has sent crude oil prices climbing, forcing corporate sectors to rapidly freeze hiring or slash workforces to manage the crisis.

The escalating conflict is casting a long shadow over the broader economy, with business vacancies simultaneously slumping to record lows. Work and Pensions Secretary Pat McFadden confirmed that the government is actively monitoring the conflict's impact while focusing on youth employment. Meanwhile, the Bank of England has warned that the ongoing war could push the UK unemployment rate up to 5.6% later this year.