UNEMPLOYMENT in the region fell to 5.2 per cent in the first three months of the year, figures showed yesterday.

The number of people claiming benefits is now the lowest since 1975.

There are 61,000 people unemployed in the region - 12,000 fewer than last year.

The North-East, while still England's worst unemployment blackspot outside London, has, along with the North-West, seen the highest number of people going back into work in the UK.

A total of 1.43 million people across the UK were jobless in the three months to April, a fall of 9,000 over the quarter.

Jobs in manufacturing continued to fall, down by 108,000 in the past year to 3.38 million, the lowest since records began in 1978.

The Confederation of British Industry (CBI) has warned the Government not to be complacent, predicting almost 40,000 manufacturing jobs would be lost in six months.

A CBI spokesman welcomed the fall in the unemployment figure, but said there was still a worrying imbalance between the numbers of jobs being created in the public and private sectors.

The unemployment rate was unchanged at 4.8 per cent, down 0.3 per cent over the year.

Other figures showed that the number of "economically inactive people", including those not looking for a job or who do not want to work, increased by 36,000 in the latest quarter to 7.81 million.

There were 194,000 working days lost due to labour disputes in April.

The Liberal Democrats said the Government was presiding over the worst decline in manufacturing.

The party's employment spokesman, Paul Holmes, said: "For all the Government's crowing on employment, the manufacturing industry in Britain is collapsing.

"More must be done to help the real economy of our towns and rural areas. Small-scale factory closures can have as huge a detrimental effect on the local community as the high-profile collapses that make news headlines."