Following the latest jobs data from the Office for National Statistics, Chancellor Jeremy Hunt said:

While unemployment remains close to historic lows, rising prices continue to eat into pay cheques which is why halving inflation this year is one of our top economic priorities.

To help families in the meantime, we are making work pay with a record increase in the National Living Wage, while providing cost of living support worth an average of £3,300 per household this year and last, funded through windfall taxes on energy profits.

The rate of UK unemployment rose to 3.8pc in the three months to February, up from 3.7pc in the previous three months, the Office for National Statistics said.

Darren Morgan, director of economic statistics at the Office for National Statistics (ONS), said: 

With the number of people neither working nor looking for a job down again, there were rises in both those in work and those actively looking for a job.

However, while the group outside the labour market - termed 'economically inactive' - fell, the number among them who were long-term sick rose to a new record high.

Job vacancies have fallen again but remain at very high levels.

Meanwhile, pay continues to grow more slowly than prices, so earnings are still falling in real terms, although the gap between public and private sector earnings growth continues to narrow.

The number of days lost to strikes picked up again in February, after January's sharp fall, albeit not to the levels seen before Christmas.

Once again education was the most affected sector, accounting for over three-fifths of the total.

Public sector pay increased by its highest percentage outside of the Covid pandemic in the three months to February.

The increase of 5.3pc in average regular pay came as 348,000 working days were lost to strike action in February, as teachers walked out.

Unemployment rose to 3.8pc over the period, according to the Office for National Statistics.

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What happened overnight 

Asian shares were trading mixed as pessimism about global uncertainties remained even as China reported a better-than-expected economic growth data.

Japan’s benchmark Nikkei 225 rose 0.5pc to 28,662.79. Australia's S&P/ASX 200 shed 0.3pc to 7,363.40. 

South Korea’s Kospi lost 0.3pc to 2,568.77. Hong Kong's Hang Seng slipped 0.7pc to 20,643.80, while the Shanghai Composite was little changed, inching down less than 0.1pc to 3,384.33. Oil prices rose.

Traders have been focused on data out of China, where first-quarter gross domestic product, which measures the value of a nation's products and services, rose a better-than-expected 4.5pc, according to official statistics. 

Wall Street ended higher on Monday after choppy trading as investors braced for a week packed with corporate first-quarter results, additional performance reports from heavyweight lenders, and further comments from Federal Reserve officials. 

The S&P 500 rose 0.3pc to 4,151.32, while the Dow Jones Industrial Average gained 0.3pc to 33,987.18, while the Nasdaq composite climbed 0.3pc to 12,157.72.

The benchmark 10-year Treasury yield rose seven basis points to 3.59pc, while the two-year yield rose nine basis points to 4.19pc.