The number of people in work has seen its biggest drop in more than four years as the number of job vacancies also slumped, official figures show.

UK employment fell by 58,000 to 32.75 million in the three months to September, while there was also a hike in those classed as economically inactive, according to the Office for National Statistics (ONS).

While the fall in employment was smaller than the 102,000 forecast, the decline over the quarter was the sharpest since May 2015, when it dropped by 65,000.

The ONS said the declining number of people working in retail after high-profile collapses and high street store closures had been a major contributor to the employment slump.

Image: Another indication of the sluggish labour market was a further slump in UK job vacancies

Chains including LK Bennett and Karen Millen have gone into administration this year.


Other retailers, including Topshop owner Arcadia, have been forced to seek legal agreements with their landlords to shut stores and slash their rent bills to avoid folding.

Although not a retailer, the travel agent and airline operator Thomas Cook, which had a major presence on the high street, went bust in September.

The figures do not include the thousands of jobs at risk at Mothercare, which called in the administrators earlier this month and so falling outside the reporting period.

Despite falling employment, unemployment over the period also dipped by 23,000 to 1.31 million.

The decline in both has been driven by an increase in the number of people judged economically inactive, which covers those who either have not been seeking work or are unable to do so.

Another indication of the sluggish labour market was a further slump in UK job vacancies, with the number of positions advertised falling by 18,000 to 800,000.

Wage growth also saw another consecutive month of decline as earnings hovered just below their pre-financial crisis peak.

Total pay continued to outstrip inflation, but the rate of growth slowed to 3.6% from the 3.8% growth reported last month.

Statisticians said the average weekly pay, in real terms before tax, for people in the UK was £470 per week.

An ONS spokesman said: "The employment rate is higher than a year ago, though broadly unchanged in recent months.

"Vacancies have seen their biggest annual fall since late 2009, but remain high by historical standards.

"The number of EU nationals in work was very little changed on the year, with almost all the growth in overseas workers coming from non-EU nationals."