The latest figures from the Office of National Statistics show the number of people in work in the region stands at 1,202,000, an increase of 5,000 over the year to April.
But the regional employment rate is just 71.2%, compared to a national figure of 75.6%.
The number of people looking for work fell 15,000, to 66,000, but the North East unemployment rate is 5.2%, significantly above the national 3.8%.
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And the year saw a sharp rise in the number of 16-64-year-olds who fell out of the jobs market altogether. The number of people in the region classed as economically inactive is 403,000 – an increase of 20,000 on the year to April.
The North East economic inactivity rate is at 24.8%, compared to a national rate of 21.3%.
The seasonally adjusted number of people claiming unemployment benefits stands at 71,200, a fall of 1,400 over the month and 38,000 over the year.
In Sunderland, there were 131,500 people in the job market, of whom 124,900 were in work. A further 47,600 were classed as economically inactive.
The employment data covers the period February to April 2022. The provisional claimant count data is for May 2022.
North East England Chamber of Commerce director of policy and representation Rhiannon Bearne said the news ‘painted a difficult picture’: "The North East continues to have the highest unemployment rate and the lowest employment rate across the UK,” she said.
"We are the only region to have experienced slight decreases in jobs and employment overall from November 2021 to January 2022.
“We remain the region with the highest economic inactivity rate in England – too many people have left our workforce altogether.
“Closing these gaps is now urgent as the UK faces another challenging economic period. It is vital that the North East, our people and businesses, are not left further behind.
"We welcome today’s announcement of David Buttress as the Government’s new Cost of Living Business Tsar. The North East business community is ready to offer practical solutions to some of these important regional challenges.”
North East Local Enterprise Partnership chief executive Helen Golightly OBE added: “The data released today paints a slightly more positive picture than the last month with an additional 10,500 people in employment.
"We have seen improvement in the employment rate across the country and it’s encouraging to see the North East moving at a slightly quicker rate than the national average in this period.“Older and younger men and women of all ages were the groups who re-entered the labour market during this quarter.
“We should, however, approach this month’s data with caution as the labour market remains volatile as the economy faces significant challenges with large increases in inflation and the cost of living continuing to rise.
"It is likely that these factors will have an impact on the labour market in months to come and we must continue to monitor these changes closely and respond accordingly.”