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Cameron hails good news on jobs
The Government has insisted its economic plan is working after new figures showed a huge fall of almost 100,000 in unemployment, while the number of people in work reached a record 30 million.
A raft of good news included falls in long-term and youth unemployment, continuing cuts in benefit claimants and the lowest rate of economic inactivity since 1991.
The Prime Minister told the Commons that 1.2 million more people were in work than when the coalition came to power, adding: "There should not be one ounce of complacency because we have still got work to do to get our country back to work and everyone back in work means greater stability for them, greater ability to plan for their future, greater help for their families.
"But the plan is working, let's stick at it, and get unemployment down even further."
Labour leader Ed Miliband pointed to figures showing a record 1.47 million people working part-time because they could not find a full-time job.
"It's good our economy is creating more jobs but the problem is too many of them are part time or low paid or insecure."
He asked the Prime Minister: "D o you agree with me it is a matter of deep concern that at the end of this year average wages are £364 lower than they were a year ago and over £1,500 lower than they were at the general election?"
Mr Cameron replied: "Of course, I want to see more money in people's pockets. The only way we can do that is to keep on with our economic plan, keep cutting unemployment, keep people's taxes down, cut the deficit so we keep interest rates down - that is our economic plan. What's yours?"
The jobless total fell by 99,000 in the quarter to October, the biggest cut in over a decade, to 2.39 million, giving a rate of 7.4%, the lowest for over four years.
The number of people in work was 30.09 million, an increase of 250,000 over the quarter and of almost half a million compared with a year ago.
Private sector employment reached a record high of 24.4 million, and long-term and youth unemployment also fell.
Other data from the Office for National Statistics (ONS) showed a 45,000 fall in those classed as economically inactive, to 8.92 million - a rate of 22% and the lowest since 1991.
The number of people claiming jobseeker's allowance fell by 36,700 in November to 1.27 million, the 13th consecutive monthly cut.
The number of people unemployed for more than a year fell by 33,000 to 866,000, the lowest for over a year, while youth unemployment dipped by 19,000 to 941,000.
Public sector employment increased slightly, by 4,000, to 5.6 million, largely because of a rise in the NHS, although the figure fell by 11,000 in local government.
The employment rate for over-65s is now 10%, the highest since records began in 1992.
Average earnings increased by 0.9% in the year to October, up by 0.1% on the previous month, giving a weekly average of £476.
Employment Minister Esther McVey said: "It is really encouraging news that the number of people in jobs has increased by a quarter of a million in the last three months, bringing the total number of people in work to a record-breaking 30 million.
"Together with a big fall in unemployment, this shows that the Government's long-term economic plan to get people off benefits and into work is proving successful.
"It's also thanks to British businesses up and down the country who are feeling increasingly confident about taking on workers. This is a great sign that the economy is growing."
TUC general secretary Frances O'Grady said: "These are undoubtedly positive figures, but we should not forget how far we still have to go to restore pre-crash living standards through better pay and jobs.
"The real test for the Government is whether everyone will share in the recovery, not just a favoured few.
"There are still hundreds of employment blackspots across Britain, with more than 15,000 long-term dole claimants in Birmingham alone. Ministers cannot ignore these areas just because the picture in other parts of the country is looking rosier."
Shadow work and pensions secretary Rachel Reeves said: " Today's figures show prices have now risen much faster than wages for 41 of the 42 months since David Cameron became prime minister."
David Kern, chief economist at the British Chambers of Commerce, said: " The strong growth in private sector employment at a time when public sector jobs are stagnating proves that businesses are up for the challenge, and are doing all they can to drive the recovery. "
Unite union general secretary Len McCluskey said: "Unemployment falling will be welcome relief to many, but the underlying trends point to a growing part-time, low-wage economy where the recovery is passing ordinary people by."
The sharp drop in unemployment to 7.4% means the figure is closing in on a key threshold used to decide interest rates much more quickly than expected.
The Bank of England's Monetary Policy Committee has said it will not lift interest rates above their historically-low level of 0.5% until joblessness drops to 7%.
Forecasts had suggested that this would remain at 7.6% for now, but today's figures showed an unexpectedly steep fall.
However, inflation - which must also be taken into account under the MPC's "forward guidance" - has dropped to a four-year low, easing any pressure for interest rates to be raised.
Graeme Leach, chief economist at the Institute of Directors, said: "The Chancellor can enjoy his Christmas break after a week of rising employment and falling unemployment and inflation. The reduction in unemployment to 7.4% will heighten speculation about tighter monetary policy, but this is likely to be a triumph of hype over reality."