The number of people without a job has fallen for the fourth consecutive month - helped by recruitment ahead of the London 2012 Olympics.
Official figures showed the jobless total fell by 65,000 in the three months to May to 2.58 million - the lowest total for over a year - meaning 8.1% of the UK workforce was unemployed, down 0.1% on April's figure.
The Office for National Statistics (ONS) said the performance highlighted growth in recruitment for the Games, in London particularly.
Wider figures showed the number of people in employment increased by 181,000 in the period to just under 30 million, the highest for almost four years, despite Britain languishing in recession .
But the numbers claiming Jobseeker's Allowance jumped by 6,100 last month to 1.6 million, including an increase of 8,000 among women to 530,700 - the highest figure for 17 years.
The ONS said that increase was likely to have been affected by a change in eligibility rules for lone parent income support from May.
As was widely expected, long-term unemployment increased again, with those out of work for more than two years up by 18,000 to 441,000, the worst figure since 1997.
There were just over a million unemployed 16 to 24-year-olds, down 10,000 on the three months to February.
Most age groups showed increases in employment, with a rise of 52,000 in over-65s in work to reach 929,000, the highest since records began in 1992 as people work longer.
Those classed as economically inactive, including people looking after a relative, on early retirement or who have given up looking for work, fell by 61,000 to 9.2 million.
That was mainly due to a cut of 82,000 among students.
The Government said the overall unemployment figures were encouraging but there was still work to do.
Employment minister Chris Grayling told Sky News: "I am always cautious about trends. The reality is we have had a good few months in the labour market.
"It does suggest that the situation in the real economy is not quite as bleak as some of the headlines suggest.
"We have seen a big increase in the number of people in employment, almost 200,000, and the majority of those are full time jobs but we have to remember we are living in very difficult times economically.
"We still have the shadows cast on the world economy, not just our own, by the eurozone crisis. I keep my fingers crossed that this is a trend but I certainly wouldn't predict it.
"A big event like the Olympic Games is bound to have an economic impact. It is bound to see the creation of more jobs.
"I hope the Games will make a lasting contribution economically by boosting activity now that has a ripple effect in the months ahead.
"In almost every part of the UK we have seen an increase in people in work over the last quarter. It is not just a London and south east issue."
Shadow work and pensions secretary Liam Byrne welcomed "good news among what's been a blizzard of pretty poor economic news over the last couple of months".
He said Britain's private sector was "doing its bit" to revive the economy but called on the Government to help youngsters struggling to find jobs.
My Byrne told Sky News: "For young people, long-term unemployment has now quadrupled over the last year.
"These are the people that the Government's Work Programme was specifically designed to get back into jobs.
"Today's figures show it's simply not working."
:: Meanwhile, it was confirmed today that Scotland had entered recession following its second consecutive quarter of 0.1% negative GDP growth.
Output in construction fell 6.9% in the first quarter of 2012.
Scotland's unemployment rate stood at 8% - slightly below the UK's rate of 8.1%.
