Union leaders accused the Chancellor today of being "wildly out of touch" with the lives of millions of people and of refusing to change unpopular policies.
Public and Commercial Services union general secretary Mark Serwotka said George Osborne's plans were "miles off course".
He added: "Two years ago we said austerity wouldn't work and we were right. It didn't work then and it won't work now, but the Chancellor is refusing to change track, presenting a smoke-and-mirrors statement that will do nothing to boost our ailing economy.
"Such a toxic combination of arrogance and economic illiteracy would be laughable if it wasn't so serious, if real people's lives and communities weren't being torn apart by this Government's failed policies."
Paul Kenny, general secretary of the GMB union, said: "Osborne is in denial that the economy is making progress and that the cuts are hitting people in a fair way.
"He says that austerity will last until 2018 but he is likely to be sacked by the electorate well before then for stalling the recovery he inherited."
Dave Prentis, general secretary of Unison, said: "Today's statement is more proof that the Chancellor neither knows nor cares about what ordinary working people in this country are going through.
"The austerity agenda means that families across the country have even less to spend on everyday essentials, while tax winners at the top have more. Raising personal tax allowances is small beer for families facing rising food and energy bills."
TUC general secretary Brendan Barber said: "When you are self-harming you should stop, not look for better sticking plasters.
"With the economy still scraping along the bottom, unemployment set to rise and the Chancellor missing his own debt target, we need a fundamental change in direction, not more muddling through.
"Cuts, austerity and squeezed living standards stretch seemingly without end into the future. What is missing today is any vision of a future economy that can deliver decent jobs and living standards - it's pain without purpose."
Sir Merrick Cockell, chairman of the Local Government Association said: "Local government has borne the brunt of cuts to public spending so far and, while it is pleasing our campaigning has resulted in councils being protected from additional cuts next year, the extra 2% cut in 2014/15 is unsustainable.
"Cutting council funding to help pay for nationally-administered economic stimulus programmes would be bad for local frontline services and makes no sense economically. Local government is one of the few parts of the public sector which actively promotes economic growth. It does that in every part of the country in a way which cannot be matched by Whitehall. The Government must enable that role rather than implement fresh cuts which will force councils to further wind down the essential support they can provide to local economic growth. A blinkered, centralist approach will undermine national economic prosperity, as the Government's own reports make clear."
Sarah Jackson, chief executive of Working Families, said: "The Chancellor's statement does not give low income working parents confidence that he's on their side.
"New legislation will have to be introduced because he wants to break the connection between inflation and benefits.
"With inflation at 2.7%, his proposed one per cent increase in benefits will hit many working parents in receipt of tax credits and child benefit hard, when they are already struggling with pay freezes and rising costs, including childcare."
John Longworth, director general of the British Chambers of Commerce, said: "Less than two weeks ago, the Prime Minister declared that Britain was in the midst of an 'economic war'. Unfortunately, the measures set out in the Government's Autumn Statement fail to match the urgency of that declaration.
"Three words need to be on every minister's lips - urgency, scale, and delivery. The Chancellor has taken a number of very positive steps, despite being constrained by politics, budgets, and Whitehall inertia.
"Business will cheer his announcement of major new capital allowances to encourage investment by small and medium-sized companies, as well as his move to shift money from current spending towards the infrastructure needed for growth."
John Walker, chairman of the Federation of Small Businesses, said: "We welcome today's statement and we are encouraged by the Chancellor's acknowledgement that small businesses need more help.
"We accept that bold actions are needed to boost the economy and we hope we are on the right road to helping small firms. The Chancellor has listened to many of our members' concerns, and has put forward proposals to address these issues - notably around capital allowances, more encouragement for investors to place funding in small businesses, and cancelling the 3p rise in fuel duty."
Richard Hawkes, chief executive of disability charity Scope, said: "If the Government is serious about a Paralympics legacy where disabled people can fulfil their potential, then it's time to strike a different tone when it comes to talking about welfare.
"The vast majority of disabled people need support. They aren't feckless, they aren't workshy and they aren't scroungers.
"It can feel like heresy, but benefits are a good thing. They enable people to live their lives. We shouldn't shy away from this."
Ian Brinkley, director of The Work Foundation, said: "The Chancellor's Autumn Statement was a mix of the welcome, the populist and the wasteful. Ultimately however, it was another missed opportunity to make a real difference to the UK's economic prospects."
Gillian Guy, chief executive at national charity Citizens Advice said: "At last we have some recognition that the welfare budget has been squeezed dry. Cutting another £3.7 billion will still hit working families and families on the edge.
"It would have been reckless to cut more just ahead of the biggest shake up in the benefits system for over 60 years. It's vital that the Government makes sure Universal Credit works for people before thinking of any more welfare cuts."
The Church of England poverty charity, the Church Urban Fund (CUF) warned that the poorest would be hit hardest by continued austerity.
Paul Hackwood, CUF chair of trustees, said: "The Chancellor tells us that turning back now would be a disaster, but austerity up to 2018 is a disaster the UK's poor can't afford.
"Public spending cuts do hit the poorest hardest and they're the least likely to benefit from the Chancellor's programme of new infrastructure spending.
"Church Urban Fund's Poverty in England research tool showed that there are families all over the country walking a tight rope between crisis and keeping on.
"The knock-on effect of cuts announced today will send some families over the edge and into the arms of already overwhelmed emergency support services such as those provided by the Church."
Matthew Reed, chief executive of the Children's Society charity, said: "Too many children are already being made to pay the price for government cuts.
"Yet measures in today's Autumn Statement will pile even more pressure on families already struggling to make ends meet.
"Cuts already set to hit children and families next year include continued freezes in Child Benefit and Working Tax Credit and cuts to housing support and council tax.
"Today's announcement of a below-inflation rise on most benefits, including those paid to poor working families, will directly punish children.
"It is intolerable that in 2012, parents across this country are unable to feed their children or heat their homes."
CBI director general John Cridland said: "The CBI has been crying out for real action on infrastructure, investment and exports.
"Five billion pounds on near-term infrastructure, like the Tube to Battersea, half a billion a year tax relief for small firms, and £1.5 billion extra export support should boost investment and create jobs.
"The Government now has everything to prove by delivering. Businesses need to see the Chancellor's words translated into building sites on the ground.
"It is no surprise that after a difficult year the economic realities dictate that austerity and debt reduction will take longer.
"The Chancellor has stuck to his guns on deficit reduction - avoiding deeper cuts or more borrowing in order to retain international credibility."
Terry Scuoler, chief executive of EEF, the manufacturers' organisation, said: "The Chancellor demonstrated that he has his hands firmly on the levers of growth and is pulling them to support growth which is driven by exports and investment.
"Today's measures on the annual investment allowance, the headline rate of corporation tax, export support and infrastructure spending have laid the foundations of a strategy to ensure business chooses to invest and grow in the UK."