LONDON British unemployment on the claimant count measure tumbled through the symbolic one million level for the first time in over 25 years, handing the labour government a powerful pre-election boost.

National statistics said on Wednesday the number of people claiming jobless benefit fell by 10,600 last month to just 996,200, the lowest figure since November 1975. The jobless rate now stands at just 3.4 percent.

With a general election widely expected in may, and with prime minister Tony Blair's government promising to make the performance of the economy a central plank of its campaign, the fall below one million could hardly have come at a better time.

Blair is way ahead of the main opposition conservatives in opinion polls which should comfortably hand him a coveted second term in office.

"I'm sure the government will be popping the champagne corks having gotten under the one million level," said Dick Howard, economist at Julius Baer Investments in London's financial district.

Unemployment is now roughly a third of the level it hit in the recession of the early 1990s. It was last this low when labour's Harold Wilson was prime minister, although it was heading the wrong direction back then.

Ironically, on the current government's preferred labour force survey measure, however, the jobless total is around 1.5 million and the rate at 5.2 percent, although both of those figures are the lowest since records began in 1984.

The IFS measure tries to capture those actively seeking work but who are not, for one reason or another, claiming benefit.

While higher than the claimant count measure, it still shows Britain in a favorable light internationally, with the jobless rate in France 8.7 percent and Germany 7.8 percent. but the united states has a rate of just 4.2 percent.

No Sign of Pick Up in Wage Pressures

The signs of a tightening labour market were not accompanied by an expected acceleration in wage pressures, however. NS said average earnings growth was steady at 4.4 percent in the three months to January, just within the bank of England's comfort zone of 4.5 percent.

The bank's monetary policy committee, which sets Britain's interest rates, cut them by a quarter point to 5.75 percent last month but left them steady last week the day after Chancellor of the Exchequer Gordon Brown unveiled his annual budget.

Economists widely expect further cuts in borrowing costs this year, as inflation remains remarkably benign and because of the economic slowdown in the United States.

They said on Wednesday the latest earnings data could pave the way for another monetary ease in the short term.

"Average earnings growth was significantly better than expected ... this takes some of the pressure off the Bank of England in terms of the constraint for a rate cut," said Julius Baer's dick Howard.

Jeremy Hawkins at Bank of America agreed: "This certainly increases the chances of a rate cut at the MPC's next meeting, though I'm not convinced this will be as early at April ... there is plenty for the doves on the MPC to coo about from these numbers."

The pound remained broadly steady after the data, at $1.448, while gilts and short sterling interest rate futures moved higher on the perception that a rate cut was now slightly more likely.