Today's quarterly figures, released by the Office for National Statistics, showed overall unemployment rate remained the same at 7.8%. Part-time employment grew by 86,000 to reach a record high of 7.66 million.
Although some of the figures reveal record highs - the number of people claiming Jobseeker's Allowance is now at its highest level since 1997 - this quarter's rise is the smallest since April 2008. The rise in unemployment is also the smallest quarterly rise since March-May 2008.
Secretary of state for work and pensions Yvette Cooper said: "The fact unemployment is significantly lower than everyone forecast at the beginning of the year shows the support Government is giving the economy is making a real difference."
But the figures continue to show deepening youth unemployment.
Although Cooper said she will guarantee "no young person gets stuck in long-term unemployment", the number of people unemployed for more than 12 months increased by 71,000 over the quarter to reach 618,000, the highest figure since the three months to November 1997. And the unemployment rate for 18-24 year olds increased by 0.7 percentage points on the quarter to reach 18% (three times higher than among 25-49 year-olds) - the highest figure since records began in 1992.
The number of 16-24 year-olds out of work increased by 15,000 to 943,000.
Carl Gilleard, chief executive of the Association of Graduate Recruiters, said: "Today's figures are a major disappointment. One in four graduate vacancies disappeared this year. It is still too early to say whether we are likely to see an improvement in 2010."
John Atkinson, associate director at the Institute for Employment Studies, added: "Today's employment figures suggest we have now approached the deepest point of the employment downturn. A careful look at the figures shows that although the claimant count continues to rise, it is now doing so at less than a quarter of the rate seen a year ago. But youth unemployment remains a major challenge."