Official figures released on Wednesday showed that the number of people out of work was up by 48,000 on the previous three months, on the International Labour Organisation measure in an article in the Guardian.

Analysts pointed out that the increase in unemployment was the slowest since last June, when the jobs market was deteriorating sharply, after improving through much of 2010.

Alan Clarke, of Scotiabank, told the paper: "If there was any doubt that the UK economy had turned the corner and that the worst news was in the past, then today's labour report should lay those concerns to rest."

However, the more timely claimant count measure of unemployment, which tracks the number of people receiving out-of-work benefits, rose by 6,900, and Jonathan Portes, director of the National Institute of Economic and Social Research, pointed to the high number of people – more than 300,000 – who have now been stuck on Jobseekers' Allowance for more than a year.

"We know that unemployment, especially youth unemployment, has 'scarring' effects; an individual experiencing a spell of unemployment has lower employment probabilities later in life," he said, arguing that joblessness is the price of George Osborne's deficit-cutting strategy.

Young people have continued to bear the brunt of the downturn, the ONS data showed, with 1.04m 16 to 24-year-olds out of work in the three months to December, an increase of 22,000 on the previous three months. The unemployment rate among this group is 22.2%.

There is little sign that pay is starting to pick up, with average earnings up 2% on a year earlier, according to the ONS – well below the rate of inflation, which dropped to 3.6% last month.

The government will also welcome the news that employment has continued to rise, picking up by 60,000 in the three months to December – though that was more than accounted for by a 71,000 increase in part-time jobs, many of them taken by women.

Meanwhile, the number of women claiming unemployment benefits has hit 531,700 – the highest level since 1995, driven partly by government reforms that have forced single mothers to return to the labour market.