There has been a record rise in unemployment - from 281,000 to 2.38 million in the three months to May, according to the Office for National Statistics.
Here, we talk to three of the "missing unemployed" - people looking for work but who do not appear on the official statistics.
MIKE BLOICE, 62, WINNERSH, BERKSHIRE
Mike says being unemployed has really affected him
Until last December I was a sales manager for a company that produced and sold budget CDs and DVDs. I've been in the music business since 1984 and before joining the company had a salary of £40,000. But I took a pay-cut and agreed to work for £25,000 hoping the sacrifice would help the company succeed and help me avoid redundancy. But I was wrong and in December I was made redundant.
I have signed up to five different agencies and, on average, apply for about three jobs a day. Some of the agencies seem to look at my age and immediately rule me out.
Being unable to find work has really affected me. It's very depressing and everyone wants to know what happened to the Mike they knew. My wife does her best and tries to support me but there's only so much she can do.
Luckily the mortgage is paid, but we have two bank loans to pay off. When I first lost my job, I did sign on and claim benefit, but this soon ran out and now I have to go the jobcentre to register to provide proof to the bank of my situation.
I don't get any help with council tax, jobseeker's entitlement or anything. The jobcentre has been useless. Their three-monthly interviews are being postponed because they're so busy. They say the jobcentre gets you the job you want and the help you need - I've got no job and no help.
At the end of the year, the insurance on our loans runs out. If I can't find a job before then, we may have to sell up and downsize to pay back the loans. It makes me angry that the banks got us into this mess, caused people like me to lose their job, but are now demanding their money back.
I would like this government to do more to cater for people like myself in their ageism laws. I believe companies are putting pressure on agencies not to put forward older candidates - and of course agencies aren't going to go against their clients' wishes.
SANDY, 22, LONDON
Sandy says he's racking up credit card debt while jobless
I just graduated from a degree in Design Engineering with a 2:1 from Brunel University. I have been looking for a job in this field since June, but have struggled to find anything. I have registered with four different agencies, applied through job websites and contacted companies directly. I must have sent off about forty applications. But when I do get feedback, which is rarely, it seems companies are asking for between five and seven years experience. How can a graduate get this experience?
When I couldn't get a job, I tried to sign on at the jobcentre but after taking about a month to process my forms, they informed me that I wasn't eligible to be unemployed or receive any benefits because I was still classed as a student until September.
I think if I'm not working and I'm not in education and I have no access to any of the university facilities, then I should be registered and able to claim. The amount I'd be claiming now would be less than any tax I earned doing work before or after. But when you go to the Jobcentre, they talk to you as if you're on the take - I don't particularly want to be signed on but any help would be great.
So now I am at the end of my overdraft, racking up credit card debt and speaking very nicely to my parents, who have said they will help me out.
It seems almost impossible now to find work as a Design Engineer so I'm going to start looking for anything else soon. I don't care what, so long as it's not supermarket work. I've worked since I was 16, firstly as a lifeguard and manual labourer and then as a Design Consultant for the Home Office during my degree work placement.
I am worried about getting stuck in a rut in another job and sitting in an office doing admin everyday for the rest of my life isn't something I want to do.
TIM BALDWIN, 50, NAILSEA, BRISTOL
I've worked in IT project management for about 10 years but after being made redundant twice, I decided to go freelance about two years ago. I set myself up as a limited company and got contracts pretty much straightaway. I was pleased to be in charge and have more control over my life. Things were going so well that I was even considering taking someone else on.
Soon I'll to have to decide whether to cease trading and effectively make myself redundant
Now I'm beginning to think going freelance wasn't the smartest move - things have changed so much for the worse. In December 2008 my last solid contract finished and I have been unable to find work since. I've tried going through contacts and agencies, and am submitting applications daily, but getting nowhere. I have even started looking for menial work, completely unrelated to my profession, but with no luck.
Operating through a limited company has helped me a little, as I realised there would be a downturn last year and so put aside some contingency money, basically allowing me to pay myself a salary of sorts, but these funds will soon run out.
If this happens, I will have trouble paying the mortgage and am actually considering putting the house on the market. I also have to question how much I can fund my daughter, who is at university. I feel like I can't give her the things I would like to.
My situation is now pretty desperate and I think soon I'll to have to decide whether to cease trading and effectively make myself redundant.
The thing is, because I am a freelancer, I am not allowed to register unemployed or claim benefit, so I don't show up on the statistics, despite being effectively out of work since January. I know many people in the same position as myself and I'd like to see somebody at least acknowledge that this is a problem. We need to encourage smaller businesses at a time like this and support them.