The unemployment rate in the North East has increased to 6.6% in the three months from June to August.
That's an increase of 1.4% from the previous 3 months and is the biggest rise in the country.
There are 86,000 people classed as unemployed in the region, an increase of 18,000 over the quarter, or 11,000 over the year.
Nationally, the unemployment rate is 4.5%, a jump from 4.1% in the previous three months.
The Office for National Statistics (ONS) said unemployment across the whole country rose by 138,000 quarter on quarter to 1.52 million in the three months to August - the highest since the start of 2017.
The ONS added that the number of UK workers on company payrolls fell by 673,000 between March and September, despite edging up by 20,000 last month.
Jonathan Athow, deputy national statistician at the ONS, said: "Since the start of the pandemic there has been a sharp increase in those out of work and job-hunting but more people telling us they are not actively looking for work.
"There has also been a stark rise in the number of people who have recently been made redundant."
Experts warned that unemployment will continue to ramp up as the Government's furlough programme comes to an end, with firms having to start making a 10% contribution to the costs of staff on the scheme last month.
The scheme will come to an end on October 31.
North East unemployment rate
National unemployment rate
But there was a small dose of cheer as the data showed a sign of recovery in vacancies, which surged by a record 144,000 to 488,000 between July and September.
Despite this, vacancies still remain below pre-coronavirus levels and 40.5% lower than a year earlier.
But businesses and economists said they are braced for mounting job losses, in spite of the Chancellor's follow-up worker support schemes.
The labour market figures released today make for worrying reading.
Niamh Corcoran, policy adviser, North East England Chamber of Commerce said: ''The labour market figures released today make for worrying reading, with employment falling and unemployment spiking in the North East.
''The region’s employment rate fell by 2.1% on the previous quarter, the largest fall of any region over the last three months. The North East now finds itself with the highest unemployment rate, the lowest employment rate and the lowest average hours worked of all British regions.
“There are a lot of firms re-opening and continuing to trade strongly but we do have to be aware that there are very likely more redundancies to come. We haven’t seen the peak spike yet.''
The NEECC claims the Government's Job Support Scheme does not go far enough to help the North East region:
Niamh Corcoran added: ''The North East urgently needs stronger economic support for the hardest hit businesses in order to protect jobs, as well as a long-term strategy for retraining and job creation.
''We also need to see support for our business start-ups. Our region needs to see swift and decisive action from Government to avoid record unemployment and long-term economic scarring.”
James Ramsbotham is the Chief Exec of the NEECC:
Chancellor Rishi Sunak insisted the Government's Plan for Jobs would help protect employment and "ensure nobody is left without hope".
"I've been honest with people from the start that we would unfortunately not be able to save every job," he said.
"But these aren't just statistics, they are people's lives.
"That's why trying to protect as many jobs as possible and helping those who lose their job back into employment is my absolute priority."