UK unemployment enjoys first fall in 18 months

Unemployment in Britain has fallen for the first time in 18 months, official figures show.

There were 2.469 million unemployed in the three months to August - 1,000 less than the 2.47 million out of work during the three months to July, the Office for National Statistics (ONS) said.

This represents the first fall since the three months to March 2008, but experts warned the crisis is far from over despite the better-than-expected figures.

Most expect dole queues to resume their upward path in the months ahead as school leavers and students enter the most difficult jobs market in a generation.

Youth unemployment edged lower to 946,000 but IHS Global Insight's Howard Archer warned: "Unless the economy turns out to be stronger than expected... many of the school leavers who cannot get a job will still be unemployed next year when the next batch of school leavers emerge."

TUC general secretary Brendan Barber said the figures gave "some cause for hope" but added: "The jobs crisis has not gone away and the economy remains very fragile."

Unemployment during the period was 88,000 higher than in the three months to May. The number of people claiming jobseeker's allowance in September increased by 20,800 to 1.63 million - the smallest rise since May 2008.

Further signs that the British labour market could be stabilising came from the number of vacancies, which have fallen in every period since April last year. These held firm at 434,000 in the three months to September.

The jobless rate also remained stable in the month, at 7.9%. This is the first time it has stayed the same since the three months to March last year, having increased in almost every intervening period.

British Work and Pensions Secretary Yvette Cooper said: "Although unemployment isn't as high today as many feared it would be at the time of the Budget, it remains a serious problem, which is why we must keep increasing support and advice to get people back into jobs."