Unemployment drops by 7,000 between June and August

The UK government has hailed a fall in unemployment as a sign that the private sector was getting stronger.

In Wales, it dropped by 7,000 in the three months August compared to the previous quarter, the Office for National Statistics (ONS) revealed.

Welsh Secretary David Jones said it showed that businesses were on the road to recovery.

The ONS put the number of people out of work at 125,000 - an unemployment rate of 8.3%.

The number of people in work in Wales rose by 40,000 to a record high of 1.37m.

Compared to the same three-month period in 2011, 8,000 fewer people were out of work this year.

It reflects a UK-wide drop in unemployment, which fell by 50,000 to around 2.53m in the quarter.

The ONS also reported a slight increase in the number of people claiming jobseeker's allowance in September. It rose by 200 to 79,700.

The number of 18 to 24-year-olds claiming unemployment benefit for more than a year continued to rise - from 1,500 in September 2011 to 4,700 last month.

Welsh Secretary David Jones said: "Today's figures demonstrate that the private sector is beginning to strengthen, and that businesses in Wales are making great strides on the road to recovery.

"Business leaders are telling me that they have renewed confidence and, although the situation remains tricky, are on the whole encouraged by the positive signs in the economy."

He said a stubbornly high youth unemployment rate underlined the need for all levels of government to work together.

A small increase in the claimant count showed there was a continued weakness in the labour market, the Welsh government said.

Business Minister Edwina Hart said there was a "strong case" for the UK government to promote growth "as its economic policy based on spending cuts is not working".

"As the Welsh government, we are taking clear actions to address some of these difficulties and are doing all we can within our powers to help people back into jobs or training," she said.

More than 1,700 young people had found work through the Welsh government's Jobs Growth Wales scheme in the last six months, she said.

Welsh Liberal Democrat business spokeswoman Eluned Parrott AM said: "These figures are good news and something that governments at both ends of the M4 must work on together to keep improving".