The number of Britons out of work rose to its highest level in more than 17 years in the three months to October, although the pace of new benefit claims appears to be levelling off, official data showed on Wednesday.
The Office for National Statistics said that the number of people out of work in the three months to October rose by 128,000 to 2.638 million, its highest level since 1994.
However, the unemployment rate held steady at 8.3 percent, in contrast to economists' expectations for a rise to 8.4 percent.
The pace of new jobless benefit claims also appears to be slowing. Three thousand Britons signed up for unemployment
benefit in November -- well below the 14,900 forecast by economists -- and the ONS revised down its October figure to 2,500 from 5,300.
Nonetheless, unemployment still looks set to increase further. Recruitment company Manpower said on Tuesday that employers' hiring intentions for the coming quarter were the weakest in three years, and the government plans to cut hundreds of thousands of public sector jobs to balance the budget over the coming years.
Separate ONS figures also out on Wednesday showed that public sector employment dropped to its lowest level since Se ptember 2003 in the third quarter of 2011, falling by 67,000 to 5.987 million.
For 2012, Britain's independent government forecasting unit, the Office for Budget Responsibility, predicts that unemployment will average 8.7 percent, and that the economy will struggle to grow more than 0.7 percent over the whole year.
Last week the bank HSBC said it would cut 300 jobs in Britain, and earlier on Wednesday travel agency Thomas Cook said it would close 200 of its 1,300 British branches.
Young people have been hardest hit by the economic slowdown. Youth unemployment rose to 1.027 million, its highest l evel since records began in 1992.
Wage growth remains muted. Average weekly earnings growth including bonuses slowed to 2.0 percent in the three month s to October, down 2.3 percent in September, in line with forecasts.
(Reporting by David Milliken and Sven Egenter)