New figures show a rise of 143,000 people in employment, driven largely by growth in the private sector. The number of unemployed young people not in full time education also fell over the quarter.
The employment growth indicates that the private sector will be able to create more jobs than the OBR predicts will be lost in the public sector.
Employment minister Chris Grayling said the figures were another welcome step in the right direction but that there was still work to do.
"It's good news to see a rise in the number of full time jobs in the private sector and the fall in unemployment is welcome. It is also reassuring to see a fall in the number of young people not in full time education who are unemployed."
And he added, "However, there are challenges ahead and our priority is to continue to support the economy, by reducing the deficit and putting in place measures to encourage growth in the private sector."