The UK jobless rate reaches 11 year high.

The number of unemployed people in the UK has risen to 1.97 million or 6.3% of the population between October and December 2008.

Latest figures from the Office for National Statistics show that the number of jobless increased by 146,000 in the last three months of 2008 and by 369,000 over the course of the year. 6.3% of the UK population are now unemployed – the highest it has been since 1998.

The fall in employment is yet a further indication of the weakening economy and credit crunch.

The statistics show that despite the fall in full-time employment, the number of people with part-time positions has risen by 33,000. The number of job vacancies has also seen a significant drop.

The number of jobseeker’s allowance claimants also saw a dramatic increase in December of 73,800, bringing the total up to 1.23m in January 2009 – the highest figure since July 1999. The number has risen by 438,100 over the year.

Analysts expect the number of unemployed to rise even higher in coming months as the recession takes hold and could reach two million.

Commenting on the latest employment figures released today (11 February), David Kern, Chief Economist at the British Chambers of Commerce, said: “Unemployment continues to rise in the face of a worsening recession. We know businesses do not want to lose key staff but they are struggling with cash-flow.

“Government needs to help address this problem if the rising number of people being made unemployed is to be curbed,” he added. “Cutting business rates, freezing the national minimum wage and scrapping plans to increase National Insurance will help firms keep hold of employees.”