Unemployment reached a 17-year high today after a 118,000 increase in the jobless total, which saw a record number of young people out of work.

The figure jumped to 2.68 million in the three months to November, the worst since the summer of 1994, giving the UK a jobless rate of 8.4%.

The figures were worst in the North East (12%) and Yorkshire (10.1%), whereas the unemployment rate fell in the South West, Northern Ireland, London and Wales.

The number of unemployed 16 to 24-year-olds increased by 52,000 over the quarter to 1.04m, the highest since records began in 1992.

And the number of people claiming jobseeker's allowance in December increased by 1,200 to 1.6m, the highest for a year after the 10th consecutive monthly rise.

Other figures showed that almost a million working days were lost in November as a result of the public sector pensions strike, the highest figure since 1989.

The Office for National Statistics reported that the number of people in full-time employment fell by 57,000 in the latest three months, but there was a 75,000 increase in part-time workers.

There was a 44,000 rise in the number of people working part-time or for themselves because they could not find a full-time job, taking the total to 1.3m, the highest since comparable records began in 1992.

Employment increased by 18,000 to 29.12m, while the number of people classed as economically inactive fell by 61,000 to 9.29 million, a rate of 23.1%.

The fall was mainly due to fewer women looking after a family or home, and fewer retired people under the age of 65.

Unemployment increased evenly among men and women in the latest quarter, while the number of people out of work for longer than two years increased by 1,000 to 424,000.

There was a 10,000 fall in the number out of work for more than a year to 857,000.

Average earnings increased by 1.9% in the year to November, down by 0.2 percentage points on the previous month.

David Cameron said the figures were "disappointing" but pointed to a small decrease in the long term unemployed. "There is not an ounce of complacency in this government. We will do everything we can to get people back to work," he told MPs on Wednesday.

Employment Minister Chris Grayling said: "The overall level of unemployment is, and will remain, a major concern for the government.

"The latest figures reflect the current challenging economic climate but also show more women entering the workforce and more students looking to supplement their income through work.

"When you take into account our welfare reforms, the number of jobseeker allowance claimants has actually fallen.

"Despite the exceptionally difficult economic circumstances, finding work for the unemployed will remain top of the government's agenda."

John Salt, director at recruitment firm totaljobs.com, said: "Whether or not the UK is technically in recession, for those out of work the situation is already dire enough.

"Today's figures merely confirm what our barometer has been telling us for three months now, that applications per job are at an all-time high of 23, with not enough growth in the labour market to absorb the numbers being laid off. What's more, the signs for 2012 just aren't good."

Paul Kenny, general secretary of the GMB union, said: "This rise in unemployment was made in Downing Street. The truth is that jobs are haemorrhaging in the public and private sectors and no one in the government seems to know what to do to stop this.

"There are parts of the country in such despair that more than a quarter of households with people of working age have no one in work."

TUC general secretary Brendan Barber said: "These figures are even worse than the bleak economic forecasts predicted, with new records achieved for youth and female unemployment.

"The fear is now that mass joblessness becomes a permanent scar on the UK - with unemployment rising by 1,300 a day towards the end of last year."

Martina Milburn, chief executive of youth charity The Prince's Trust, added: "Britain's jobless generation are losing hope for the future.

"Unemployment can have a devastating effect, not just on future job and wage prospects, but also damaging well-being and mental health."

Meanwhile John Walker, chairman of the Federation of Small Businesses, said: "Unemployment figures are still rising and do not look set to improve. We know from our members that small firms are looking to shed staff in the first three months of 2012.

"Job losses from the small business sector would make for a difficult labour market. But we can turn this negative story around, if government is bolder in its changes to existing employment law to incentivise job creation."

David Kern, chief economist at the British Chambers of Commerce, said: "In the face of a challenging economic climate, an increase in unemployment is not entirely surprising, but certain aspects are actually more positive than expected.

"Employment has increased modestly despite the rise in unemployment. This shows the level of inactivity is falling as people return to the labour market and look for work. It is also important to note that more than 300,000 of those aged 16-24 are in full-time education seeking work.

"Nevertheless, the situation is difficult and the combined impact of the austerity plan and problems in the eurozone will result in further increases in the jobless total."