HispanicBusiness

The region's jobless total stood at 125,000, or 9.7 per cent - a fall of 2,000 - for the final quarter of last year.

But employment in the NorthEast also fell 3,000 to 1,172,000, or 67.7 per cent.

North-East Chamber of Commerce director of policy Ross Smith said the figures were surprising, with a sudden reversal of the trend that had seen strong growth in employment and reduction in unemployment throughout last year.

However, he added: "The changes do not alter the fact that, over the year, the North-East fared significantly better than the UK as a whole, but this sudden swing in fortunes reported in the final month means the overall gap with UK rates once again widened."

The number of people in the North-East claiming jobseekers allowance stood at 93,400 or 7.7 per cent, compared with 4.7 per cent nationally.

Across the country, the number of people claiming jobseekers allowance fell to a near two-year low after a huge increase in employment.

Nearly 30 million people were in work at the end of last year, an increase of 154,000 on the quarter to September, and the highest total since records began in 1971.

But Tom Blenkinsop, Labour MP for Middlesbrough South and East Cleveland, said the headlines of falling unemployment did not reflect what was happening in his constituency.

He said: "Yet again, these figures show that unemployment is up in my constituency from the previous month. Similarly, unemployment is up in the neighbouring constituencies of Redcar and Stockton South - most striking here is the level of 18 to 24year-old claimants for sixmonths ormore, which is up almost 70 per cent since the General Election in 2010.

"Despite this, the North-East remains amongst the hardest hit by Government cuts."