Long-term unemployment remains "worryingly high" despite recent increases in jobs, according to a new report.
The IPPR think-tank said the UK could learn lessons from Sweden's response to tackling unemployment after a recession by investing more in education and jobs programmes.
The number of people out of work for more than a year increased by 13,000 to almost 900,000 in the quarter to August, with new unemployment figures being published later.
The IPPR's report, written by former Swedish finance minister Par Nuder, said that in the aftermath of the early 1990s recession, Sweden's government invested heavily in creating jobs, training and work experience opportunities.
Kayte Lawton, senior research fellow at the IPPR, said: "There are some big lessons for the UK to learn from Sweden's deficit reduction programme in the second half of the 1990s.
"Sweden was hit by a major financial crisis in the early 1990s, which pushed the deficit up to 10% of GDP, the highest in the OECD, while unemployment tripled. But between 1994 and 1998 the Social Democratic government turned a large deficit into a surplus while investing heavily in programmes to tackle unemployment.
"Key to the government's strategy was the drive to raise the employability of the long-term unemployed through innovative employment and training programmes. The Social Democrats prioritised investment in education, training and job subsidies over spending on benefits.
"These policies improved the skills base of Swedish workers with an eye to the long-term and gave unemployed people a chance to gain real, paid experience and a recent reference. The UK can learn a lot from the Swedish experience."
Last month's figures showed a 50,000 fall in unemployment in the quarter to August to 2.53 million, and a 212,000 increase in employment to almost 30 million.