The number of people unemployed in the UK rose by 80,000 to 2.51 million in the three months to July, official figures have shown.
This is the largest increase in nearly two years, the Office for National Statistics (ONS) said. The jobless rate now stands at 7.9%.
Youth unemployment also rose sharply, by 78,000 to 973,000.
The total claiming Jobseeker's Allowance rose by 20,300 in August to 1.58 million.
The number of people in employment in the economy fell in the three months to July, by 69,000 to 29.17 million.
"Clearly this is a very unwelcome set of figures. Any increase in unemployment is something we really don't want to see happen," said Employment Minister Chris Grayling.
He said the data would "reinvigorate" the government's "determination" to take steps to get the economy growing and create private sector jobs.
The government is looking to the private sector to offset job losses in the public sector resulting from its wide-ranging programme of spending cuts, designed to reduce the UK's debt levels