The number of unemployed people in the UK rose by 27,000 to 2.53 million for the three months to January 2011, recording the highest levels since 1994, the Office for National Statistics (ONS) said on Wednesday.

The unemployment rate in Britain stood at 8 percent in November-January 2011, up 0.1 percent compared with the previous three months. Markets had expected the UK unemployment rate to remain unchanged at 7.9 percent during the period.

The unemployment rate for those aged from 16 to 24 increased 0.8 percent to 20.6 per cent, the highest figure since comparable records began in 1992, ONS said.

However, the number of people seeking jobless claims fell unexpectedly by 10,200 to 1.45 million in February. Economists had expected jobseekers’ allowance count to increase by 1,300 in February.

Besides, the number of people in employment rose 32,000 to 29.16 million for the three months ending January. The employment rate decreased to 70.5 percent, down 0.1 percent.

The Confederation of British Industry (CBI) estimates that the unemployment rate in Britain will reach 8.4 percent in 2011, up from 7.9 percent last year and that it will remain unchanged in 2012.

In its emergency budget in June 2010, the coalition government proposed fiscal consolidation amounting to £113 billion ($179 billion) per annum by 2014-2015, aimed at cutting 500,000 public sector jobs among other measures.