Budget 2009: Record high for New Labour unemployment
A further 177,000 people lost their jobs between December and February as unemployment rose to its highest since Labour came to power in 1997.
The total jobless figure of 2.1 million is the highest since February 1997, several months before Tony Blair's election victory.
The official data from the Office for National Statistics, which comes hours ahead of the chancellor's Budget announcement, shows that the number of people on unemployment benefits rose 73,700 to 1.46 million during the same period.
The figures mean that 2,000 jobs were lost every day in the three months to February.
Alan Tomlinson, partner at licensed insolvency practitioners Tomlinsons, commented: "The impact of the recession on smaller businesses is especially severe. Company failures in this vital sector are still increasing and are likely to do so for some time yet, putting more and more people out of work.
"Sadly, these appalling unemployment figures will get much, much worse before they get better - there's still a lot of pain in the pipeline."