THE number of people out of work and claiming benefit fell to its lowest level for 28 years last month, the latest figures have revealed.

The claimant count fell by 6,900 during last month to 930,800, its lowest level since September 1975.

But despite the fall, the claimant count rate, which compares the jobless total to the number of people of working age, was unchanged at 3.1 per cent for the 20th month in a row, the Office for Na- tional Statistics said.

The number of people out of work in the three months to the end of July fell by 1,000 to 1,493,000.

The unemployment rate was unchanged on the previous quarter, at 5.1 per cent, but down 0.1 per cent over the year.

The figures showed more gloom for the manufacturing sector. The UK's manufacturing workforce fell by 125,000 in the three months to the end of July, compared with the previous year, to 3.5m, the lowest level since records began in 1984.

The biggest fall was in the electrical and optical equipment, textiles, leisure and clothing sectors.

Overall, the number of people in work rose by 63,000 to 27,929,000 between May and July, the highest level since records began.

The average pay packet continued to grow - up 3.4 per cent on the same period a year ago.

But the figures showed people working longer hours. The total number of hours worked per week was a record 901.6 million, up 8.5 million over the quarter.

Des Browne, Minister for Work, said: "Despite the uncertainties of recent months, the UK economy continues to generate new jobs.

"There are over a quarter of a million more people in work than a year ago, unemployment is down and economic inactivity is also lower."

Paul Holmes, Liberal Democrat shadow minister for work, said: "Although the Government claim record employment levels, they cannot mask the haemorrhage in the manufacturing sector.

"Ministers must get to grips with the real economy of our towns and rural areas.

"Small-scale factory closures have as detrimental an effect on the local community as the high-profile collapses that make news headlines."

Conservative shadow minister for work Oliver Heald said the rise in people in work was entirely accounted for by growth in self-employment.

Regionally, unemployment figures fell by 1,000 in the North-East, taking the figure to 73,000, or 6.4 per cent of the workforce.

In Yorkshire and Humber, numbers rose 12,000 to 130,000, equivalent to 5.4 per cent.