LONDON (AP) -- Britain's unemployment rate spiked to 8.4 percent in November, its highest level since 1995, official figures showed Wednesday.
The figure is up from last month's 8.3 percent and follows a run of fairly downbeat economic news.
The Office for National Statistics also said there were 2.7 million people out of work in the three months from September to November. That is the highest figure since 1994.
Unemployment is rising as the British economy has flatlined in the wake of the debt crisis in the euro area, which has dented economic confidence, and as the government continues with its deficit-reduction program.
The statistics office also found that pay growth remains relatively muted as high unemployment keeps a lid on wages.
Analysts expect unemployment to continue to rise
"Public sector staff cuts will be accompanied by private sector job losses, as companies focus on cost-cutting in the face of what many are expecting to be a challenging year ahead," said Chris Williamson, chief economist at financial data company Markit.
The report came a day after some rare good news, a sharp drop in the U.K.'s consumer prices inflation rate from 4.8 percent to 4.2 percent. But that too was a measure of a tough year ahead; retailers contributed to the improved inflation rate by slashing prices in December to lure customers.
- Office for National Statistics