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"Unemployment could become one of the main economic and political issues this year"
- Peter Dixon, an economist at Commerzbank AG
The number of people claiming unemployment benefits rose by 1.2 thousand to 1.6 million in December and the unemployment rate increased to 8.4 per cent, the highest rate in 16 years, said the Office for National Statistics on Wednesday.
"The economy is not growing much and if you extrapolate that over the next six months, jobs are going to pretty hard to find," said Peter Dixon, an economist at Commerzbank AG in London.
"Unemployment could become one of the main economic and political issues this year and may well be one of the triggers for more stimulus from the Bank of England."
"Any increase in unemployment is disappointing and obviously a tragedy for the person who becomes unemployed - that is why we are taking action to get people back to work," said U.K. Prime Minister David Cameron.