According to figures released this week by the Office of National Statistics (ONS), the total unemployment rate has soared to 5.7% over the three months to August – a rise of 0.5% or 164,000 on the previous quarter.
The figures were met with surprise by many commentators and reflect the worsening economic climate.
CBI's deputy director-general John Cridland said: "These figures are worse than we expected. They suggest the fallout from the slowdown in the economy is being felt by individuals faster and sooner than previously thought.
"These figures pre-date the collapse of Lehman Brothers and the turbulence which followed, indicating unemployment is likely to rise further through the winter."
He urged moderation in pay settlements as a means of combatting the challenges the economy faced.
Unite, however, laid the blame at the feet of former Conservative Prime Minister Margaret Thatcher.
General secretary of the union, Derek Simpson, said: "Thatcher buried Keynesian economics and the current crisis shows just how wrong she was. It's time to resurrect John Maynard Keynes and kick-start the economy.
"Government intervention should not just stop with the banks," he added.
John Maynard Keynes advocated reductions in interest rates and government investment in public-private projects such as infrastructure.
Unemployment soars at fastest rate for 17 years
The number of unemployed people in the UK has risen at its fastest rate for 17 years to 1.79m over the past three months, prompting fears that the jobless total could reach 2m by Christmas.
