Between April and June, the number of people out of work fell to 2.08 million, down 132,000 from the previous quarter and 437,000 lower than a year ago.
The unemployment rate is now 6.4%, the lowest since late 2008 when the recession began to take hold, and down from 7.8% a year ago.
However, workers have yet to feel the impact of the recovery. Pay including bonuses fell 0.2% over the year. At the same time, inflation has risen to 1.9%, pushed up by higher spending on clothing and footwear, food and non-alcoholic drinks.