Deterioration in the jobs market is accelerating, with the number of people claiming unemployment benefit last month rising at the fastest rate for almost 16 years, according to official figures published yesterday.

Unemployment statistics were unveiled as thousands more financial services jobs appeared to be at risk from of the potential merger of HBOS and Lloyds TSB.

Even without this, economists warned yesterday that the outlook was likely to worsen. Many employers have frozen recruitment. Redundancies were also expected to spread to other areas of the economy.

Financial Times, The Times, Daily Telegraph