Liverpool Labour Market 2026: Employment Trends, Key Sectors and Outlook

Liverpool, one of England’s major core cities and the economic heart of the North West, presents a labour market in transition in 2026 — one shaped by persistent structural challenges but also by some of the most ambitious investment plans in the city's recent history.

Current Employment Figures

Based on the latest available Office for National Statistics Annual Population Survey data (April 2024–March 2025), Liverpool's employment rate is 57.3%, compared with a Great Britain average of 60.8%. Total employment is estimated at around 223,400 people, while unemployment stands at 5.3%, above the national rate of 3.9%. These figures were the latest available local labour market estimates published by Liverpool City Council as of September 2025.

The city's claimant count — a measure of residents claiming unemployment-related benefits — stood at approximately 19,300 according to the latest Liverpool City Council data. This represents a claimant rate of 5.7%, compared with a Great Britain average of 4.0%. While the claimant rate remains above the national average, it has remained relatively stable in recent months, reflecting a labour market that has softened but not deteriorated significantly.

Economic inactivity remains a structural concern. Around 28.2% of Liverpool's working-age population are economically inactive — neither employed nor actively seeking work — compared to 21.5% nationally. This gap has been a persistent feature of Liverpool's labour market and is a central challenge for policymakers.

Sector Breakdown

Liverpool's workforce skews heavily towards the public sector, which accounts for 26.8% of employment — well above the Great Britain average of 18.3%. The private sector accounts for the remaining 73.2%.

By occupation, professional roles make up the largest share of the workforce at 25.3%, followed by associate professionals at 20.7% and administrative and secretarial roles at 11.2%. Manufacturing and construction together account for under 7% of jobs, reflecting the city's post-industrial shift towards services.

The sectors that have driven employment growth most strongly in recent years include health and social care, accommodation and food services, and the visitor economy. The Knowledge Quarter — home to two universities, a major hospital, and a growing cluster of life sciences and research institutions — has become one of the city's most significant employment hubs.

Wages and Cost of Labour

According to the latest Annual Survey of Hours and Earnings data, full-time employees living in Liverpool earned a median gross weekly salary of £726.70, while jobs based in the city paid a median of £737.20 per week. This equates to an annual full-time salary of approximately £37,800–£38,300, reflecting continued wage growth in recent years. Despite these increases, earnings in Liverpool remain below levels typically seen in London and much of South East England, helping to preserve the city's reputation as a relatively cost-competitive location for employers.

At the national level, the Liverpool Chamber of Commerce noted in February 2026 that wage growth across the UK had eased to 4.2% annually — marginally above inflation — with hiring activity weakening as businesses absorbed higher employer National Insurance contributions, increases to the National Minimum Wage, and the impact of the Employment Rights Act. These pressures have led some Liverpool employers to slow recruitment, particularly for younger candidates.

Hiring Conditions in 2026

The broader UK labour market has continued to soften during 2026. According to the latest Office for National Statistics data, the number of payrolled employees across the UK fell by approximately 104,000 between March 2025 and March 2026, with provisional estimates indicating a decline of around 210,000 compared with April 2025. Vacancies have also been trending downward since their post-pandemic peak, reflecting a more cautious hiring environment as employers respond to higher labour costs and slowing economic growth.

For Liverpool specifically, the claimant count edged upward through late 2025 and into early 2026 — consistent with a cooling labour market — though the increases have been modest, and the city's claimant rate has remained relatively stable at around 7.6–7.7% over recent months.

Investment and Growth Outlook

Despite current headwinds, Liverpool is the subject of substantial medium-term investment commitments that are expected to reshape its labour market over the coming years.

In March 2026, the Liverpool City Region Combined Authority launched a £2 billion Investment Fund, with initial capital directed towards high-quality office space in the city centre, new lab and industrial units across the wider region, and support for fast-growing sectors including advanced manufacturing, life sciences and digital technology. The fund forms part of a broader 10-year Growth Plan, launched in October 2025, targeting £10 billion in additional economic output and tens of thousands of new jobs across the city region.

The Liverpool Freeport, now operational, has the potential to add £850 million to the local economy and create up to 14,000 jobs in sectors including pharmaceuticals, logistics and clean energy.

Priority growth sectors identified in the Growth Plan include advanced manufacturing, health and life sciences, digital and technology, and creative industries — alongside maritime, professional services, and the visitor economy.

What This Means for Jobseekers and Employers

For jobseekers, Liverpool offers a meaningful concentration of opportunities in health, professional services, hospitality and emerging tech sectors, though competition for roles is higher than in many comparable UK cities given the elevated claimant rate. Graduates from the city's two universities — the University of Liverpool and Liverpool John Moores University — add to a well-educated labour pool, with 44.1% of working-age residents holding a degree or equivalent.

For employers, Liverpool presents a cost-competitive hiring environment relative to London and the South East, with lower average wages and a large pool of economically inactive residents who, with the right support, represent a significant latent workforce. The challenge lies in skills alignment — the Growth Plan specifically highlights the need for further education colleges and training providers to align their provision with the sectors driving future demand.

Conclusion

Liverpool's labour market in 2026 reflects the city's broader economic journey: structurally distinct from the national average in unemployment and inactivity, but increasingly supported by targeted investment and a clearer long-term industrial vision. For those looking to hire or find work in Liverpool, understanding these dynamics — the cooling short-term conditions alongside the ambitious medium-term agenda — is essential context.