Business leaders in the West Midlands were today dismayed by new figures which showed that the rate of unemployment in the region continued to be the highest in the country.

According to figures released today by the Office of National Statistics, unemployment nationally soared to a 17-year high of more than 2.5 million. Statistics  for the West Midlands showed that 265,000 were out of work, an increase of 27,000.

This meant that 9.9 per cent of the region's workforce was jobless, a further blow after the shock rise of 48,000 between September and October.

Christine Braddock, president of Birmingham Chamber of Commerce, said: "Although were are not surprised by the latest figures, they are extremely worrying. 

In addition to on-going public sector job losses, the private sector is facing high levels of inflation plus last quarter's shock contraction in the economy and high costs in raw materials. 

"It is also bracing itself for a large raft of employment legislation over the course of this Parliament.  We are broadly supportive of the government's cuts agenda, which recognises that it is vital to shrink drastically the size of the structural deficit.  

"But government debts currently cost the UK £119 million a day and need to be addressed if the country and the region are to see more sustainable growth.  

"The Chamber also welcomes the government's commitment to HS2, which will add thousands of jobs to the economy of Birmingham and the surrounding areas."

Mike Ashton, spokesman for the West Midlands Chambers of Commerce, said: "These figures are disheartening but the private sector can create the growth and jobs needed for the region.  

"However, if it is to do this we need a halt to cumbersome red tape which hinders job creation and is expected to cost the West Midland's businesses £1.74bn over the next four years.  We also urge the Monetary Policy Committee to hold interest rates at their current level, which is helping boost the manufacturing sector in particular."