UK jobless claimant count jumps unexpectedly in Jan

The number of Britons claiming unemployment benefit rose unexpectedly in January and by the biggest amount since July last year, official data showed on Wednesday.

The Office for National Statistics said claimant count unemployment rose by 23,500 last month, wrongfooting analysts who had forecast a 10,000 fall.

That wiped out the declines seen in the previous two months and took the total number of claimants to its highest since 1997.

The figures will dampen recent optimism that the labour market is stabilising and suggest the outlook remains fragile, particularly given an impending public spending squeeze to rein in a bloated budget deficit.

"We've seen quite a chunky increase in unemployment. At face value it's not a nice number," said Alan Clarke, UK economist at BNP Paribas.

Sterling fell after the figures, although reaction was muted as investors digested minutes to the Bank of England's February meeting, released at the same time, which showed the decision to pause a 200 billion pounds asset-buying scheme was unanimous, although for some it was finely balanced. [ID:nLDE61G0U7]

The number of people without a job on the wider ILO measure fell by 3,000 in the three months to December to 2.457 million, leaving the jobless rate at 7.8 percent, as expected.

Average weekly earnings growth remained subdued, rising by 0.8 percent in the three months to December compared with a year ago. Excluding bonuses, average weekly earnings rose by 1.2 percent for a third month running, the lowest since this series began in 2001.

Analysts said Wednesday's data fitted in with other evidence of a sluggish recovery. Britain's economy expanded by just 0.1 percent in the final quarter of last year after an 18-month long recession that wiped out around 6 percent of economic output.

"It seems to fit more with the underlying reality," said Ross Walker, an economist at RBS.