ROCKETING fuel prices could put people out of work and the Chancellor must "understand" those pressures, the jobs minister yesterday suggested.

Chris Grayling also acknowledged the dole queue could get longer in the first half of this year, but insisted the coalition was focused on growth and would boost employment over 2011.

His comments come as fuel prices have soared, not least due to VAT rising to 20%.

Unemployment in the North East also rose by 5,000 in the quarter to November, leaving 120,000 on the dole queue. The region’s unemployment rate stands at 9.6%, second only to the West Midlands.

The employment level in the region fell by 36,000, with the rate dropping by 2.1% over the same period, while those classed as economically inactive climbed by 34,000 to 451,000.

Asked about the impact of rising petrol prices, Mr Grayling said: “David Cameron has asked the Treasury to take a look at what can be done and indeed [Treasury Chief Secretary] Danny Alexander talked about possibly taking measures to help remote rural communities.

“And I think, yes, we do need to understand the pressures that a rising oil price can bring. I know the Treasury is looking very hard now at what it can do in the context of what is happening at the moment.”

He insisted there was no surge in unemployment, but stressed the need to create the right environment for business – for example tax incentives for regional firms taking on new staff.

“I would expect growth to be a major theme of the next few months, including the Budget.

“I think it is likely that the Chancellor will want to have more to say about what we are trying to do to stimulate growth and stimulate employment.”