Research by the Office for National Statistics (ONS) shows that from November to January of 2011, the unemployment rate was 8.4%. Since then, the unemployment rate was gradually falling, all the way up until the start of the coronavirus pandemic. The unemployment rate rose sharply in 2020 from 4% to 5.1% but has since begun to decline again back to pre-pandemic levels.
Recent analysis from the ONS shows that the unemployment rate for January to March 2022 is at 3.7%, 1.2% lower than the same time last year. This is excellent news as a whole that the economy and the UK labour market are back on the trajectory we were before the pandemic happened.
However, not all towns and cities have unemployment rates so low. Some places and regions haven’t been so lucky, and they are still struggling. So, we thought it would be interesting to find which towns and cities these are.
That’s why in this article, we’ll explore the top 10 towns and cities that have the highest unemployment rates in the UK, why they might have high rates, and also which regions are experiencing the worst of it.
Which towns and cities have the highest unemployment rate?
According to ONS data, Birmingham has the highest unemployment rate in the UK, with 8.9% of all working-age people (between 16 and 64) being unemployed. It’s followed closely by Blackpool with 7.9%, Wolverhampton with 7.7%, Bradford with 7.2%, and Oldham with 6.9%. The highest unemployment rate is seen in the north and midlands of the country, often in places that were historically manufacturing and production locations.
It should be noted that the data uses claimant count statistics. This is the number of working-age people (16 to 64) who are on unemployment benefits such as Jobseeker’s Allowance or Universal Credit.
1. Birmingham – 8.9%
Topping this list is the largest city in the Midlands, Birmingham. With a city population of approximately 1.149 million, this city located in West Midlands is the second largest metropolitan area and the third largest urban area in England and the UK. Historically a market town and then later an influential manufacturing city, furthering advancements in sciences, technology, and economic development during the first Industrial Revolution, the city was heavily bombed during World War 2.
Since then, Birmingham was forced to undertake drastic changes to infrastructure and overall urban renewal. By most accounts, it has thrived economically and is only behind London and Manchester in terms of Gross Value Added (GVA) in the UK. The service sector employs most of the working population in the city. However, Birmingham leads the UK with the highest unemployment rate with a staggering 8.9%. The figure has decreased from 9.1% in March, showing that it is improving, but this figure still far exceeds number two on the list.
2. Blackpool – 7.9%
Blackpool is a town and seaside resort on the North West coast of England. With a population of approximately 140,000, it hasn’t quite reached city status but is considered an extremely large town. It was once an incredibly popular tourist destination for people in the UK, with workers and families travelling the length of our island to visit this seaside town in the 20th century. But with the introduction of accessible air travel in the 1960s, popularity has waned over the decades. Tourism is still a significant driver of the economy in Blackpool, but with declining visitors each year, the economy has taken a hit. The local government has made a conscious effort to venture into the service sector since then, which provides a sizeable number of jobs, but it hasn’t quite reached the levels they would like to. This has affected the labour market greatly and has led to high unemployment levels, with 7.9% claiming unemployment benefits.
3. Wolverhampton 7.7%
Coming in at number three on this list is the city of Wolverhampton. Also located in West Midlands, Wolverhampton used to be a market town which then developed into a hub for coal mining, lock making, steel production, and car and motorcycle manufacturing during the first Industrial Revolution. Except for a newly opened engine assembly plant for car manufacturing company Jaguar Land Rover, most of these traditional manufacturing and production industries have since closed down.
Most of the city’s workforce is employed in the service sector, particularly in public administration, health, and education. But this midland city is still recovering from the closing of its once essential industries and has 7.7% of the working-age population claiming unemployment benefits.
4. Bradford 7.2%
Following behind in fourth place is the city of Bradford. The large city has a population of approximately 350,000 and was once a powerhouse in textile manufacturing during the Industrial Revolution – particularly wool. It was a boomtown for wool and was considered the centre of wool manufacturing during that period. But, following the deindustrialisation in the 20th century, the textile and industrial sectors declined rapidly. It has since struggled to fully recover, with poverty being high and an unemployment rate of 7.2%.
5. Oldham 6.9%
Located in the area of Greater Manchester, Oldham is a large town with a population of approximately 240,000. Like Bradford, it too was a textile manufacturing powerhouse during the first Industrial Revolution. The town specialised in cotton and, at its peak, is largely considered to be one of the most productive cotton spinning mill towns globally. Much like Bradford, the decline in textile manufacturing has left an economic gap in Oldham, with 6.9% of working-age residents claiming unemployment benefits.
6. Kingston upon Hull – 6.7%
Kingston upon Hull, typically shortened to Hull, is a port city with a population of approximately 260,000. Located in the Yorkshire and the Humber region, historically, this city was known for its trading and sea fishing. Since fishing has declined, attention has focused on maximising their port for transporting cargo and roll-on roll-off ferry services to European destinations. Hull’s economy is also fueled by tourism and the retail sector, however, the transition hasn’t been easy. Recent figures show that Hull has an unemployment rate of 6.7%, making it the sixth-highest in the UK.
7. Middlesbrough – 6.5%
At number seven on this list is the town of Middlesbrough, located in the northeast of Yorkshire. With a population of around 140,000, this town used to be involved in the coal industry, ironworks, shipbuilding, and steel production in the late 19th and early 20th centuries. Post-industrial decline hit this town hard which has impacted its local economy significantly. Through the town’s ports, trade is still prevalent, but nowadays, service jobs related to digital companies contribute to the economy the most. Still, there is a 6.5% unemployment rate in Middlesbrough.
8. Rochdale – 6.5%
With a population of around 280,000, Rochdale is a large town that is a mere 5.3 miles away from Oldham. Similar to its neighbouring town, Rochdale was a boomtown in the Industrial Revolution and was known for textile manufacturing. It also has the Rochdale Canal, which during that period was a highway for the transport of coal, cotton, and wool to and from the town. Akin to Oldham, Rochdale has struggled economically since then and currently has one of the highest rates of unemployment amongst working-age people in the UK at 6.5%.
9. Luton – 6.4%
The first entry on this list from the South East of England, Luton is a large town located in Bedfordshire with a population of around 218,000. Historically, Luton was famous for its hatmaking. This is also shown in its football team which is known as the Hatters and has a picture of a hat on its logo. Whilst hat production has declined significantly, there are still a few major hat production companies in Luton. The town was also known for its car production. Vauxhall Motors had a car production plant in Luton between 1905 and 2002 and also had its head office in the town until 2019 when it moved.
Since then, the focus has shifted from production to services. One of Britain’s major airports is located in Luton – London Luton Airport – and has a service-based economy centred around the airport industry. However, it still has a significant unemployment rate of 6.4%.
10. Manchester – 6.2%
Rounding off the top 10 list of the towns and cities with the highest unemployment is the city of Manchester. With a population of over 550,000, Manchester is one of the biggest cities in the UK. It was once a textile manufacturer during the Industrial Revolution, helped by its port and ship canal. But since the deindustrialisation of the 20th century, the economy declined. After the low point of the IRA bombing in 1996, considerable investment efforts were made to restore Manchester as a UK powerhouse – which has been successful.
The city of Manchester is second in the UK in terms of GVA, only behind the capital city, London. This is thanks to the service industry, which is the sector in which most companies in Manchester operate. However, there is a great deal of income disparity in the city. Whilst Manchester boasts many multi-millionaires, the city also has a high unemployment rate, with 6.2% of working-age people currently out of jobs and claiming unemployment benefits.
|Town or City
|Unemployment rate (% of people aged 16 to 64 claiming unemployment benefits)
As you have seen through this article, labour statistics from the Office for National Statistics show that the towns and cities with the highest unemployment rate tend to be in the midlands or north of the country. This is mainly due to the fact that production and manufacturing industries during the Industrial Revolutions were located in these places. These towns and cities were the economic hubs of their sector in the UK and, in some cases, the world.
With such reliance on these industries, once the deindustrialisation process began in the mid-20th century, most of these places were unable to recover fully. Some cities such as Birmingham and Manchester have been able to recover much faster and are considered economic hubs in the UK. There are numerous factors for this, but population, educational institutes, and investment have been key drivers that helped this process along. However, smaller towns and cities have had a more challenging time, which has kept employment rates low.
As with many countries, the 21st century has seen a more significant shift from manufacturing and producing economies to service-based economies – the UK is no different. 2018 data shows that the service sector is responsible for 80% of the total UK economic output. Therefore, it’s no wonder that the cities and towns that have not adapted to this also have some of the highest unemployment rates in the UK.