The number of workers on zero-hours contracts in their main job fell by 4,000 to 901,000 in the quarter to last December compared with the previous year.
The jobless rate - or the proportion of the workforce that is unemployed - stood at 4.4 percent in the three months to the end of December, the Office for National Statistics said in a statement. This was the first increase in the unemployment rate in almost two years.
Pay for workers in Britain picked up in the fourth quarter and productivity gained as fewer jobs were filled by foreign nationals in the a year ago.
Maike Currie, investment director for personal investing at Fidelity International, said with the Bank of England increasingly pinning the chances of further interest rate hikes on accelerating pay growth (alongside Brexit progress), the prospect of an early rate rise seems "unlikely".
Nonetheless, the data painted a mostly robust picture of the labor market, with productivity - a major weakness of Britain's economy over the last decade - recording its best performance since the 2008-09 recession in the second half of 2017.
Kamal Haasan's new party is called Makkal Needhi Maiam
Haasan on the launch of the latter's political outfit as a "social courtesy" and not a stormy portend for NDA politics. When contacted, Haasan's publicist said the authorities denied the permission saying the students will be "disturbed".
Economists were split on whether the latest data made an interest rate hike in May more likely.
The ONS attributed the rise in unemployment to a fall in the number of people who are neither working nor looking for a job. And private sector pay growth accelerated to 2.6% from 2.3%.
Average weekly earnings excluding bonuses rose 2.5 percent from a year earlier, the most since December 2016, the Office for National Statistics said on Wednesday.
ONS statistician Matt Hughes said: "While this is the sharpest increase in the unemployment level ONS has seen in nearly five years, the number of people in work has continued to rise and there are fewer "economically inactive" people - those neither working nor looking for a job". The number of Eastern European workers fell.
Separate figures showed that Britain's government recorded a January budget surplus of 10 billion pounds (about $14 billion), slightly bigger than forecast, helped by a surge of income tax receipts that typically comes at the start of the calendar year.