My MRes will be unclassified - will this make applications outside academia less competitive? I have just graduated 2.1 in a bioscience subject and have been offered an MRes / MSc(Res) (masters by way of research). I really want to do the MRes because I want to test my aptitude for research, publishing and continuing to a Ph.D.

It's a well-worn trope, but I had also hoped to build upon my 2.1 by earning a distinction to make potential applications (in/outside academia) more competitive. I believe I would be capable of that given my performance on a final year lab research module.

However, during my application I learned that the MRes as offered in my department is “unclassified” - it is only pass/fail. It does not attract the classic masters classifications of pass/merit/distinction.

I am in my mid-thirties. I am split 50/50 between my heart (using the MRes to continue to a Ph.D) and the pragmatic (exiting academia and applying for a bioscience-based postgraduate scheme or job so I can start earning while I learn). My aptitude for staying in academia is something I intend to get a feel for while doing the MRes.

Will the fact the MRes is unclassified mean that I am not appreciably increasing competitiveness of my application for positions outside of academia?

To take one example, the NHS Scientist Training Programme has a minimum entry standard of 2.1. However, someone on the admissions committee tells me that 2.1’s are screened out in favour of 1st class degrees. In that scenario, a masters with distinction could patch that up.
If you has a 2.2 or for some other reason did not meet the requirements for a position you are interested in, then having a classified MSc would be very helpful. Vary rarely do positions require a 1st. Automated culling of applications based on a 1st or 2.1 generally doesn't happen. Someone will still look at your application if you have a 2.1 and an unclassified MSc. If they see good research, the 2.1 will not matter anymore. 

That said, a student with a 1st is looked at differently then someone with a 2.1. If at the start of the course, you were given the option for a classified or unclassified degree it would make sense for you to choose the classified degree. If you are choosing between equally ranked courses that will both offer you identical learning and research opportunies and one is classified and the other is not, the classified one has the potential to help you more. The benefit, however, is tiny and differences in opportunities, subjects, and/or personal preferences, will offset any benefit between a 2.1 and a 1st.