UNEMPLOYMENT in the North-East rose by more than five per cent between April and June, Government figures have shown.

The number of people unemployed in the region rose to 64,000, up by 2,000, the highest level since Christmas.

Despite the rise, the number of people claiming Jobseekers Allowance fell.

Industry leaders in the region said the increase represented a temporary blip, and said that business was buoyant.

However, regional development agency One NorthEast said the figures, which show a reversal of recent unemployment trends, were a concern.

But a spokesman said the unemployment rate had actually fallen compared with the same period last year.

Steve Rankin, regional director of the Confederation of British Industry, said: "This is probably just a blip. The economy is really quite strong in the North-East.

"One swallow doesn't make a summer.

"It may just be students coming into the market or it could be people moving between jobs."

Andrew Sugden, director of policy for the North-East Chamber of Commerce, said: "Our members, from the various studies we carry out, are telling us that they are buoyant and many are looking to expand.

"There are obvious ongoing issues regarding the oil costs, which could be putting cost pressures on businesses. This could be leading to temporary workers not having contracts renewed, which would have an impact on the unemployment figures.

"There could be all sorts of reasons for it, but it is not a reason to panic at the moment."

Unemployment nationally increased by 27,000, despite another fall in the number of people claiming Jobseekers Allowance.

The unemployment rate, covering the latest quarter to June, increased by 0.1 per cent to 4.8 per cent across the UK.

The number of economically inactive people, including those who are sick or disabled, have taken early retirement or who have stopped looking for work, increased by 89,000 to 7.85 million - the highest figure since records began in 1984.

The number of economically inactive men increased during the three months by 51,000 to 3.1 million, also a record high, while among women, the figure rose by 38,000 to 4.75 million.

The data from the Office for National Statistics also showed that the number of people out of work for longer than a year had fallen 18,000 to 290,000, the joint lowest on record.

There were 658,300 job vacancies in the UK last month, up by 74,100 from a year ago and one of the highest on record.