Europe’s Jobs Market: Q3 2025 Signals the End of the Boom
Work News | New Stardom
Trend Analysis
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Latest employment, unemployment, and vacancy data from Q3 2025 points to a cooling EU labor market after two years of historic job growth.
Unemployment across the EU-27 in Q3 2025 remains at historic lows, but the trend of falling joblessness is over. The employment rate has reached a ceiling, with no further gains visible in the working-age population. Meanwhile, job vacancy rates are now falling at their fastest pace in three years, a decline that started in manufacturing and construction and is now visible in services as well. Wage growth is also losing momentum, with most countries reporting pay increases that only match or trail inflation. As a result, the market for new hires has cooled significantly; however, broad layoffs have not occurred, and redundancies remain limited to specific sectors.
Hiring demand is contracting more quickly than overall employment, so the jobless rate remains flat. Youth employment continues to lag behind the average for prime-age adults, and gender gaps in participation persist, with female employment highest in northern Europe. Germany, the Netherlands, and Czechia continue to post the lowest unemployment and highest employment rates, while Spain, Greece, and Italy record the highest jobless rates, with minor increases this quarter. Central and Eastern European countries that led the recovery after the pandemic now show stagnant or declining employment and softer wage growth.
Wages are still rising most rapidly in information, communications, and healthcare, but growth in these sectors has moderated. In contrast, pay growth in manufacturing is now the weakest across the EU-27. Although vacancy rates remain highest in care and technology, the difference with other sectors is narrowing as employer demand cools. Labour cost growth is broadly aligned with market trends. No country reports wage contraction, but wage pressures have eased, and employer bargaining power has increased.
This report compiles the most recent data for Q3 2025, including unemployment, employment, job vacancies, and wage trends for the EU-27.
Download the full PDF for country-level data, sector comparisons, and a detailed, evidence-based analysis of the state of work in Europe.
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