Economy

State’s unemployment rate unexpectedly drops to 4.2%

Latest CSO figures indicate there were 119,300 people classified as unemployed in February, compared with 129,300 the previous month

The headline jobless rate for February corresponded to 119,300 people beimg unemployed. Photograph: iStock

Eoin Burke-Kennedy
Wed Mar 6 2024 - 11:24

The State’s unemployment rate unexpectedly fell in February, defying a general softening of economic conditions internationally linked to higher interest rates.

The seasonally adjusted jobless rate dropped to 4.2 per cent in February, from 4.5 per cent in January but still ahead of the 4.1 per cent recorded in February last year.

The headline rate corresponded to 119,300 people unemployed, compared with 129,300 the previous month. There was an increase of 6,500 in the seasonally adjusted number of people unemployed in February when compared with a year earlier, the Central Statistics Office (CSO) said.

The youth unemployment rate also fell to 10.5 per cent down from a revised rate of 11.7 per cent in January, the CSO said.

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The latest unemployment numbers come on the back of exchequer returns for February, published on Tuesday by the Department of Finance, which show Government tax receipts were up on an annual basis by 5.5 per cent at €12 billion in February.

The strong performance was driven in the main by income tax, which was up by nearly 6 per cent year on year, reflecting buoyant conditions in the labour market with a record 2.71 million people employed.

“Despite challenges such as geopolitical uncertainty and a global economic slowdown, the labour market remains robust. Low unemployment levels have driven strong consumer spending, supporting the domestic economy amid a slowdown in multinational exports,” Jack Kennedy, of recruitment website Indeed, said.

“Consumer sentiment is improving amid a sense that cost-of-living pressures are easing somewhat, although many consumers are likely to need further evidence of better days ahead before this becomes more ingrained,” he said.

“For employers in many sectors, recruiting staff is likely to remain difficult for now, especially at a time when wage growth has slowed, suggesting many are simply not in a position to offer would-be recruits higher salaries,” Mr Kennedy said, noting Irish job postings on Indeed remain 16 per cent above pre-pandemic levels at the end of February, albeit this is down from 23 per cent in January.

Eoin Burke-Kennedy

Eoin Burke-Kennedy

Eoin Burke-Kennedy is Economics Correspondent of The Irish Times

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