Jobless total hits 2.5m - Yorkshire tally up 10 per cent

In Yorkshire, the number of people looking for work rose by 18,000 to 258,000 - an increase of nearly ten per cent in the quarter to March.

Nationally, the figure was 2.51 million, up 53,000, while the UK's employment rate slumped to 72%, the lowest since 1996.

Other figures from the Office for National Statistics showed that the number of people classed as economically inactive has reached a record high of 8.17 million.

The total, which includes students, people looking after a sick relative or those who have given up looking for work, increased by 88,000 in the latest quarter and is now the worst since records began in 1971.

Youth unemployment has also increased, with the number of 16 to 24-year-olds out of work up by 18,000 to 941,000, the joint highest since records began in 1992.

The number of people in work fell by 76,000 to 28.83 million following a reduction of 103,000 in full-time workers, compared with a rise of 27,000 part-timers.

Job vacancies fell by 6,000 to 475,000, the first quarterly fall since last autumn.

The only bright spot in today's grim figures was another fall in the number of people claiming jobseeker's allowance, down by 27,100 last month to 1.52 million, the lowest level for a year.

The so-called claimant count has now fallen for three months in a row and in five out of the last six months.

Long-term unemployment, counting those out of work for over a year, increased by 94,000 to 757,000, the highest figure since 1997.

Average earnings increased by 4% in the year to March, a 1.5% increase on the previous month, showing the highest growth rate since the summer of 2008.

The increase reflected higher bonuses across most sectors of the economy compared with a year ago.

Public sector employment continued to grow in the final months of Gordon Brown's premiership, up by 7,000 in the last quarter of 2009 to 6.1 million, compared with a 61,000 fall in private firms.

The number of jobs in the UK fell by 119,000 at the end of last year to 30.75 million, with hotels and restaurants among the worst affected.

Average pay, including bonuses, was 459 a week in March, 6 up on February.

TUC General Secretary Brendan Barber said: "While it failed to feature much in the election campaign, today's rise show that unemployment remains a pressing social and economic problem particularly among young people.

"The dole queues have not been as high as they might have been thanks to action by government, employers and unions, but this cannot be taken for granted.

"It would be a huge mistake for the new Government to cut support for the unemployed, particularly the Future Jobs Fund, a policy that has prevented unemployment scarring a generation of young people as it did in the 1980s."

John Walker, chairman of the Federation of Small Businesses, said: "The rise confirms that the UK is still too fragile for small firms to take on new staff. As the country's job creators, we know that small firms want to take on new staff but are put off by taxes and are cautious about whether the economy is strong enough, so the new Government's reversal of the payroll tax is welcome news.

"The FSB has long been saying the planned 1% rise was a tax on jobs so this move will really help small firms to take on more staff and so help tackle unemployment."

A spokesman for youth charity The Prince's Trust said: "One in five young people are still out of work. These figures remind us of the vital need to support young people into jobs and training before the unemployed become the unemployable.

"Eighty per cent of young people on Prince's Trust programmes achieve a positive outcome and we look forward to working with the new government to help young people into work."

Nigel Meager, director of the Institute for Employment Studies, said: "Despite the early signs of economic recovery, it is clear that the new government inherits a very fragile labour market.

"We will also begin to see public spending cuts feed into the labour market this year. It is difficult to escape the conclusion that unemployment is likely to remain high for some time without sustained and substantial economic growth. The economic recovery is by no means securely established and it is to be hoped that the new administration's decisions on the timing of deficit reduction will take account of the risk of further damage to a labour market that remains weak."

David Kern, chief economist at the British Chambers of Commerce, said: "The labour market figures are disappointing for the second month in a row, and support our forecast that unemployment is likely to hit 2.65 million towards the end of the year.

"In addition to the rise in unemployment, the figures show a large decline in employment, and a further increase in inactivity. The phenomenon of under-employment - the number of people working part-time because they could not find a full-time job - increased to a new record high.

"Additionally, public sector earnings continue to grow at a much faster rate than the private sector - an unacceptable and unaffordable trend.

"In light of this, it is vital that the new government takes forceful measures to enable businesses to create jobs and growth. It must go further than its early announcements, and scrap the entire planned rise in employers' National Insurance contributions without delay."

Graeme Leach, chief economist at the Institute of Directors, said: "The increase in the wider measure of unemployment is a strong reminder to the new Chancellor that economic recovery remains fragile, but this does not mean that we should avoid public spending cuts.

"On the contrary, the sooner decisive action is taken to bring expenditure under control, the greater the possibility of acceleration in the recovery. The way to reduce the deficit is by lower spending not higher taxation. Evidence from around the world shows that raising taxation risks killing the recovery, but at times of fiscal crisis, squeezing spending actually works to strengthen the economy. This is a difficult message to sell, but it is nonetheless the right one.

"The current pattern of employment change is unsustainable."

John Cridland, deputy director general of the CBI, said: "These jobs figures show how fragile the recovery is, and we expect tough labour market conditions to continue for some time. It is notable that those working part-time because they cannot get a full-time job is over 1 million. Earnings growth, excluding bonuses, was largely driven by the public sector."

Kevin Green, chief executive of the Recruitment and Employment Confederation, said: "The latest unemployment figures are one of the first indicators that the new Government has on the state of the economy and the fragility of the jobs market.

"Reducing unemployment and creating jobs should be the central priority of this new administration. Our flexible jobs market has already ensured that unemployment has not reached the levels seen in other European countries and will play a major role in helping people back into work."

Dr John Philpott, chief economic adviser at the Chartered Institute of Personnel and Development, said: "If David Cameron's incoming coalition Government wanted reminding about the economic policy challenge that lies ahead, Conservative and Liberal Democrat ministers need look no further than today's dire official jobs figures.

"Higher unemployment, including more unemployed young people, fewer people in work, especially full-time work, an increase in redundancies, a fall in job vacancies and especially a record number of economically inactive people sends out a clear SOS message on the state of the UK labour market.

"How to combine the critically important task of cutting the fiscal deficit with meeting the equally important challenge of restoring full employment will provide Mr Cameron and his coalition partners with their sternest test. The rhetoric of getting Britain working again is about to meet reality."

Chris Ball, chief executive of the Age and Employment Network, said: "Given the manifesto commitments of both the Conservative and Liberal Democrat parties to introduce measures that will encourage and require people to work longer, news that the proportion of people who have been unemployed or claiming benefits for over 12 months is highest amongst the over 50 age group will be a cause for concern.

"Plans to reduce public spending and employment in the public sector will hit older workers particularly hard. The Prime Minister and his new team need to think urgently about what additional support they can put in place so that the many thousands of older workers who are likely to be joining the unemployment register soon, do not drift into premature and unwanted retirement.

"We lost a generation of older workers in both the recessions of the 1980s and 90s, we simply can't allow that to happen this time around."