The British Government today warned that further rises in unemployment were expected before the summer as figures showed those claiming jobseeker’s allowance soared to the highest level since Labour came to power in 1997.
The number of people claiming rose by 23,500 last month to reach 1.64 million.
Long-term unemployment, covering those out of work for more than a year, increased by 37,000 in the quarter to December to 663,000, also the highest figure since 1997.
The number of people classed as economically inactive also reached a record high of 8.08 million – more than 21% of the working age population.
Union leaders said the figures showed the recession was far from over, while a business group said it was a “feel bad” recovery, warning that the economy may experience a double-dip back into recession in the first half of 2010.
The British Prime Minister said measures being taken by the Government would steer the UK clear of the recession.
He also said a conference will be held on Monday involving 300 investors from all over the world to talk about the “great opportunities” to invest in this country.
Work and Pensions Secretary Yvette Cooper welcomed a 3,000 fall in total unemployment to 2.46 million, but warned: “We know things are going to be tough for a while and we expect further increases in unemployment before the summer. That’s why it’s so important to increase help for people now, not cut it back.”
Other data from the Office for National Statistics showed the number of people in employment fell by 12,000 to just under 29 million.
There was a drop of 37,000 in full-time employment, offset by a 25,000 increase in part-time employment.
Unemployment among 18 to 24-year-olds fell by 13,000 in the last three months of 2009 to 725,000, while for 16 to 24-year-olds the total dropped by 13,000 to 923,000.
There was an 18,000 rise in the number of unemployed women to 959,000, the biggest quarterly jump since last summer.
Gordon Brown, interviewed on LBC radio, said: “We’re not through everything yet but I think the measures we’re taking over the next few months, to help teenagers, to help young people under 24, to help adults to get in to work and to help firms continue to be able to get cash-flow help, an essential element of the country not only coming through the recession but getting stronger for the years to come.
“I’m interested in the future jobs, jobs of the future. There’s certain to be large number of jobs from the electric car, to renewable energies, to wind power, that will develop in all areas of green industries, low carbon industries.”
Shadow work and pensions secretary Theresa May said: “Any fall in the headline unemployment figures is welcome, but we still have a long way to go to undo the damage done by Labour’s recession.
“What is very concerning about today’s figures is the rise in the number of people claiming Jobseeker’s Allowance, and the steady growth in the number of people becoming long-term unemployed.”
Liberal Democrat work and pensions spokesman Steve Webb said: “Record numbers of people out of work for more than a year is the Government’s dreaded landmark.”
TUC general secretary Brendan Barber said: “These figures show that unemployment was static over the Christmas period. Given that many were predicting that joblessness would still be rising, this is a vindication of the Government’s extra investment in support for the unemployed.
“However, the economy is still on a knife edge. Any suggestion that now is the time to start cutting back on the extra support for unemployed people should be firmly rejected.”
Dr John Philpott, chief economic adviser at the Chartered Institute of Personnel and Development, said: “Conditions in the UK labour market remain extremely weak and talk of the jobless rate having already peaked is premature.”
David Kern, chief economist at the British Chambers of Commerce, said: “While these figures are broadly welcome, they hide some worrying trends. Full-time employment continues to fall, the number of people working part-time is at a record high, there was a large increase in those claiming benefits and inactivity has risen further.”
Graeme Leach, Chief Economist at the Institute of Directors said: “This really is the feel bad recovery. Today’s numbers support the IoD’s view that the economy may experience a double-dip to the recession in the first half of 2010."