The number of Britons out of work and claiming benefits rose for the eighth month running in September, the longest stretch of increases since the economic slump of the early 1990s, official figures showed today.
The Office for National Statistics said claimant count unemployment rose by 8,200, more than double that predicted by analysts. August's rise was also revised higher to 2,700 from 1,600 previously.
Annual average earnings growth in the three months to August, meanwhile, remained steady at 4.2 per cent, as expected, in a sign the recent jump in inflation is still not feeding through to pay deals.
Bank of England Governor Mervyn King also said yesterday that so far data on wage deals looked reassuring but added the extent of the current economic slowdown is unclear, denting expectations of further interest rate cuts.
The BoE cut interest rates in August for the first time in two years to counter slowing economic growth and many analysts expect a further reduction within the next few months.
Mr King, however, said that policymakers need to keep an open mind on where interest rates are going and that central banks could not target short-term movements in output.
The ONS said there were 151,000 redundancies in the three months to August, mostly in manufacturing and the highest in 2 years. Employment, however, soared by 103,000 in the three months to August to a record 28.76 million.