Unemployment in the UK fell by 57,000 in the three months to May, the Office for National Statistics (ONS) has revealed.
The rate is now 7.8%, but growth in jobs - only 16,000 more people were in work while the population is rising, and 9,000 of those were on government programmes - slowed significantly, and the employment rate fell by 0.1% to 71.4%.
The fall in unemployment reflects a rise in economic inactivity rather than jobs, with 87,000 more not looking for work, up 0.2% to 9.04 million, although it is unclear whether more of these people would be trying to enter the job market if they believed they would be successful.
The number receiving Jobseeker's Allowance fell by 21,200 to 1.48 million, and this is likely to reflect increased sanction rates which see unemployed people have benefits withdrawn following a tightening of conditions.
Wages continue to underperform; in the week that inflation rose to 2.9%, regular wages are only going up by 1% per year (1.7% for those who get bonuses), meaning workers have been getting poorer each year during the economic downturn.
Growth in long-term unemployment is continuing, with 915,000 now out of work for more than a year, 32,000 higher than three months ago and the highest since 1996.
The north/south divide is still in evidence; London and the south saw falls in unemployment while Scotland, Wales and much of the north saw rises.
The problems of young people also go on; although the number unemployed saw a fall of 20,000 to 959,000, there were 31,000 fewer in work and 37,000 more who were economically inactive.
An increase of 24,000 in the number of vacancies to 529,000 gives cause for hope for unemployed people, although this still means nearly five people are competing for each job.
David Kern, chief economist at the British Chambers of Commerce, told the BBC: "With employment rising and unemployment falling, the labour market remains an area of strength for the UK economy.
"There are some areas of concern, however. Long-term unemployment is up, and youth unemployment, while edging down, is still too high. But at a time when the government's austerity plan remains in force and the public sector is shrinking, it is reassuring that the private sector is willing and able to create jobs."
But Dave Prentis, general secretary of the Unison union, said: "Small relief in the unemployment figures will be no comfort to those struggling with the misery of long-term unemployment.
"Every job lost is a personal tragedy and the government has to do more to tackle the persistent jobs crisis."
UnemployedNet says:
On the face of it a fall in unemployment looks like good news. Dig a bit deeper though and a different picture emerges, one which shows vulnerable people disappearing from the register but not getting work.
We detect the hand of sanctions in this; figures released in June show that the number having benefits removed has rocketed from around 130,000 each year in 2006 to 110,000 in a single month more recently.
This would help to explain why unemployment is going down while the number out of work and counted as inactive has shot up by 87,000.
Behind all joblessness lie personal stories of suffering, both material and spiritual, but behind sanctions are stories of real deprivation.
Imagine having all of your income withdrawn, having no savings and no access to borrowing, and trying to live on no money simply because you didn't sign up to the Universal Jobmatch website, or an adviser believed you weren't looking for work hard enough, or you missed one meeting with your adviser.
Those who are sanctioned are likely to form an underclass forced to turn to crime simply to feed themselves; only the most short-sighted government would believe that this was better than having to justify higher unemployment figures.
Of course there is an alternative, and we only need to look across the Atlantic to find it.
Having seen the economic downturn start in his country and increase joblessness far above the UK's, President Obama focused on investing more in public services to help create employment.
The result is that the USA now has lower unemployment than the UK and it is coming down more quickly.
Investment in jobs, including real infrastructure improvements and better public services, would help to solve the crisis in a way that lifts workless individuals, giving them back their self-respect.
It would also help Britain as a country to look itself in its collective mirror again rather than creating and compounding the misery of thousands.