The number of Scots in work has reached a new high, with a record 2,585,000 people across the country now in employment.

The total, which covers the period January to March this year, is the highest since records began in 1992.

Employment is up by 29,000 over the quarter and is 67,000 higher than the same time last year, figures from the Office for National Statistics revealed.

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The employment rate in Scotland continued to be above that for the UK as a whole, with 73.5% of the population in work north of the border, compared to 72.7%.

At the same time as employment rose, the number of Scots who are out of work fell.

There were 178,000 people unemployed in the period January to March, a drop of 18,000 over the quarter and 21,000 lower than the first three months of last year.

Across the UK as a whole, employment also reached a record high, with more than 30.4 million people now in work.

Scotland has a lower jobless rate than the rest of the UK, with this now at 6.4% north of the border compared to 6.8%.

As well as the fall in overall unemployment there was a drop in the number of Scots who are out of work and claiming jobseeker's allowance.

This stood at 103,000 last month - the lowest for more than six years - with the total down by 2,000 from March and 33,000 less than April last year.

Both First Minister Alex Salmond and Scottish Secretary Alistair Carmichael welcomed the new record high in employment.

Mr Salmond said: "Today's employment figures mark a further improvement on last month's record figures and demonstrate the Scottish Government's policy of investing in infrastructure to boost the economy is making significant progress with employment levels at a record high."

The number of women in employment is now 1,238,000 - 38,000 higher than the first three months of 2013.

Mr Salmond said it is "estimated that Scotland has one of the highest rates of female employment in the European Union".

He added: "Scotland continues to outperform the UK across employment, unemployment and inactivity rates, which shows that even with the limited powers over the economy at our disposal, we are improving our country's economic health."

Meanwhile, Mr Carmichael insisted the figures show Scotland is "doing well as part of the UK".

The Scottish Secretary said: "In the first quarter of 2014, unemployment in Scotland fell by 18,000 and employment rose by 29,000. It is also very good to see the number of Scots claiming jobseeker's allowance has now fallen for 18 straight months and is at a six-and-a-half-year low.

"Being part of the large UK single market gives us stability and certainty and helps create jobs and opportunities. We now have a record number of Scots in work, wages rising, inflation falling and the highest employment rate of all nations in the UK.

"As our economy recovers and businesses are becoming more confident it is good to see they are employing more and more Scots."

Despite the overall fall in unemployment, Training, Youth and Women's Employment Secretary Angela Constance said "challenges remain", with the figures showing the number of 16 to 24-year-olds who are out of work is 5,000 higher than last year.

Ms Constance said: "Although Scotland continues to have a better youth employment rate than the UK as a whole, there is always more to do. Youth unemployment increased by 5,000 over the last year and I am determined to tackle the challenges young people face."

While the number of women in employment is up on last year, female employment in the period January to March was 5,000 less than the previous quarter.

Liz Cameron, chief executive of Scottish Chambers of Commerce, said: "This is good news to hear that Scottish unemployment is falling. The overall figure shows that Scottish businesses are becoming more confident to invest in new talent for the growth of their company.

"However, digging deeper with these figures, we can see that males have experienced an increase in employment, but this is not the same case for women - who experienced a fall in employment by 5,000. It is crucial that our businesses prioritise a diverse skills base to maximise the opportunities available to the Scottish economy."

Liberal Democrat leader Willie Rennie said more people in work and unemployment falling showed that "Scotland is sharing in the progress of the UK coalition Government, and with Liberal Democrats at its heart we are building a stronger economy and a fairer society".

Mr Rennie said: "With taxes down, pensions up, more jobs and new childcare, today's figures show that sharing across the UK's broad shoulders offers the best of both worlds.

"This is positive news but figures from last quarter remind us that we cannot become complacent. The Scottish Government must work with the UK Government to unlock further opportunities for jobs and growth for Scotland."

Grahame Smith, general secretary of the Scottish Trades Union Congress (STUC), said with "another decent rise in employment and the fall in unemployment", the figures show the "labour market recovery does appear to be strengthening".

But he added: "It is important that the extent of the challenge that remains is understood. Although these figures may have confirmed a 'record Scottish employment level', it must be stressed that the employment rate is still 1.4% below the 74.9% achieved in summer 2007. The unemployment rate remains 2.4% above its pre-recession trough and the fall confirmed today only takes the rate back to where it was last autumn.

"No new statistics were published today for Scottish full-time, part-time or self-employment. Trends in under-employment do appear to be levelling off but, again, there is some distance to travel before pre-recession rates are achieved. Progress on youth employment is much too slow.

"It is noteworthy that women's employment actually declined over the last quarter. Whilst some care must be taken in interpreting volatile quarterly figures, it would be a concern if the strong trend in women's employment growth over the last year was to reverse."