Unite leader Len McCluskey dismissed official figures yesterday that showed the biggest annual unemployment fall since 1988 and called for a parliamentary probe into the reality for British workers.

The number of people officially classed as “jobless” fell 146,000 in the three months to July — down 468,000 in 12 months to 2 million.

At the same time self-employment rose again to 4.54m — up 368,000 over the year.

But in a twist, the Office for National Statistics (ONS) reported a 114,000 increase to 8.93m in the number of 16 to 64-year-olds deemed “economically inactive.”

Just under 2.3m of them “want a job” but are not recorded as unemployed — a 68,000 rise on the previous quarter.

Prime Minister David Cameron gloated that the reported drop in unemployment was “quite remarkable.”

But Mr McCluskey accused the Tories of painting a “rosy picture” that masks the day-to-day drop in living standards drop facing millions.

And he urged the Treasury select committee to mount a series of hearings into “winners and losers” in the economic situation.

“There are serious questions to be asked whether we are on the road to recovery, bearing in mind there are 4.5 million self-employed, the widespread and insidious use of zero-hours contracts and with hundreds of thousands of young people losing hope of a future with a decent job,” said Mr McCluskey.

Pay is “significantly and stubbornly” lower than inflation, he warned.

The latest ONS labour survey showed that wages rose by just 0.6 per cent in the year to July.

Over the previous 24 months inflation eroded an average worker’s pay by more than £25 a week.

Shadow employment minister Stephen Timms predicted that the current trend would bring about the biggest fall in real earnings in a single Parliament since 1874.

“Pay excluding bonuses today is the lowest on record,” he warned, pledging that a Labour government would bring in a higher minimum wage, freeze gas and electricity bills and launch a mass house-building programme in a bid to ease the “cost-of-living crisis.”