Unemployment reached a 10-year high of just under two million as a record of number of people were made redundant and job vacancies slumped to a new low, official figures showed today.
The number of people claiming Jobseeker's Allowance has now increased for 12 months in a row, up by 73,800 in January to 1.23 million, the highest total since the summer of 1999.
The wider measure of unemployment, which includes people not eligible for benefits, increased by 146,000 in the three months to December to 1.97 million, the worst figure since just after Labour came to power in 1997.
The figure confounded experts who had predicted that unemployment would surge over two million today following a spate of job losses in recent months.
Unemployment has now increased by 369,000 over the past year and is expected to top three million as a result of the current recession.
Almost 260,000 people were made redundant in the last three months of 2008, the highest figure since records began in 1995 and an increase of 104,000 over the previous quarter.
Job vacancies fell by 76,000 to 504,000 in the three months to January, the lowest since records began in 2001, according to today's data from the Office for National Statistics.
Meanwhile, the number of people in work dropped by 45,000 in the latest quarter to 29.36 million, the lowest total since the autumn of 2007.
Manufacturing jobs continued to be lost, down by 101,000 in the three months to December to 2.8 million, the lowest since records began in 1978.
The UK's unemployment rate is now 6.3%, an increase of 1.1% over the past year. The number of unemployed men increased by 106,000 in the three months to December to 1.18 million, while 790,000 women were out of work, a rise of 40,000.
The number of people unemployed for more than a year was 453,000, up by 18,000 from the previous three months, while unemployment among 16 to 24-year-olds was 616,000, up by 38,000, and the highest total since early 1995.
Average earnings increased by 3.2% in the year to December, unchanged from the previous month, although the figure was 4% in the public sector.
There were 1,000 days lost through industrial disputes in December from just four stoppages, the lowest figure since 1931.
Unemployment in the regions between October and December was (tabulate under region, total unemployed, change on quarter, unemployment rate)
Northern Ireland 42,000 plus 8,000 5.1%
North East 105,000 plus 5,000 8.4%
North West 263,000 plus 33,000 7.8%
Yorkshire and the Humber 173,000 minus 8,000 6.6%
East Midlands 142,000 plus 7,000 6.1%
West Midlands 204,000 plus 34,000 7.7%
East 165,000 plus 24,000 5.5%
London 294,000 minus 3,000 7.2%
South East 218,000 plus 16,000 4.9%
South West 127,000 plus 13,000 4.7%
Wales 100,000 plus 5,000 7.0%
Scotland 137,000 plus 11,000 5.1%