UK unemployment held at 4.7% in the three months to June, matching the highest level since mid-2021, according to the Office for National Statistics (ONS).

Vacancies dropped by 44,000 over the same period to 718,000, their lowest since April 2021. The ONS said the decline was driven by fewer roles in hospitality, retail, and arts and entertainment.

Payroll employment fell by 66,000 over the quarter, with a 26,000 drop between May and June.

Average earnings, excluding bonuses, grew 5% year-on-year but rose just 1.5% in real terms once inflation was factored in.

ONS director Liz McKeown said the figures pointed to “a continued cooling of the labour market.”

The data follows the Bank of England’s move last week to cut interest rates to 4%, with policymakers signalling unemployment could rise further later this year.

ING economist James Smith said the jobs market is “undoubtedly cooling”, but slower falls in employment suggest the worst may be over.