Unemployment steadies around 2.5m but the peak is yet to come

The number of people out of work rose again in the three months to April, although economists welcomed a fall in the numbers of people claiming Jobseeker's Allowance.

The unemployment rate was 7.9% in the three months to the end of April, down from 8% in the three months to the end of March.

The number of unemployed people rose by 23,000 to 2.47 million but that was lower than the peak of 2.51 million in the three months to March.

In the quarter, the number of people of working age who are not employed rose to 8.19 million, representing over 21% of the working age population. But the number of people claiming Jobseeker’s Allowance was 1.48 million, 30,900 lower than in the three months to January. 

Howard Archer, economist at IHS Global Insight said: 'It is still evident that the number of unemployed has been limited by people withdrawing from the labour market for the time being. It also indicates that the claimant count unemployed figure is being reduced by people either being unable to claim benefits or choosing not to.'

The number of people unemployed for more than twelve months increased and the there are now 5.2 unemployed people per vacancy - also an increase.

There was some small cheer for those people concerned that the high rate of youth unemployment is storing up more pain for the future, as unemployment among 18 to 24 slipped back by 2000 to 713,000.

Vicky Redwood, senior UK economist at Capital Economics said: 'The UK labour market is showing some signs of further improvement, but the fiscal squeeze could soon bring this to a halt.'

'It won’t be long before public sector job losses begin in earnest,' she said.

In the first three months of the year only 7,000 public sector jobs were lost.