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Unemployment shows marked rise

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The number of people out of work in the UK climbed by 53,000 in the first quarter of the year.

According to data released by the Office for National Statistics (ONS), the jobless total is now 2.51 million, its highest point since 1994.

The quarterly figures overshadowed the 27,000 April fall in the claimant count which measures the number claiming benefits.

The unemployment rate remained at 8 per cent in March.

The mixed messages coming from the labour market suggest that, despite the pick up in business and economic activity in the three months to March, it is still too early to declare that the employment situation is over the worst.

The employment rate in the UK is now at its lowest since 1996, indicating that there is still an amount of spare capacity in the economy.

One consequence may be to dampen wage settlements.

Although average earnings picked up by 4 per cent over the period, when bonuses are taken out if the equation, the growth in pay was a more moderate 1.9 per cent, the ONS reported. This compared with an increase of 1.7 per cent for the three months to February.