Unemployment falls to 7% as restrictions ease and activity resumes

Covid-adjusted unemployment in the Republic fell to 7 per cent in February on the back of the lifting of pandemic restrictions in late January. This was down from 7.8 per cent for the previous month and 27 per cent a year ago.

The headline rate includes people in receipt of the Government’s pandemic unemployment payment (PUP).

The Central Statistics Office (CSO) estimated there was as many as 180,745 people classified as being either out of work or in receipt of the PUP last month.

The latest figures come amid reports of labour shortages across several sectors linked in part to an exodus of foreign workers during Covid.

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The standard measure of unemployment, which does not include PUP recipients, was put at 5.2 per cent.

Following the reintroduction of restrictions on December 7th, the Government reopened the PUP scheme, which had been closed to new entrants. Restrictions were lifted again on January 22nd.

The CSO's recent Labour Force Survey shows that the economy added an 229,000 jobs last year, a gain of over 10 per cent, putting employment levels above pre-pandemic levels.

Full employment

The Central Bank is predicting unemployment will fall to 5.3 per cent next year and to 4.9 per cent in 2024, a level that is consistent with full employment in the Irish economy.

Jack Kennedy of recruitment site Indeed said:"The rate of unemployment fell in February as the reduced pandemic restrictions helped to stimulate rehiring and returned the labour market to a positive path that the Central Bank of Ireland forecasts."

“Ireland’s ability to recover rapidly from labour market shocks is notable given that the UK and euro zone economies have yet to see their labour markets recover to such a great extent,” he said.

“Whilst the jobs environment looks broadly positive, an area of potential concern remains the increasing numbers in long-term unemployment,” he said, noting that 44,300 people were categorised as long-term unemployed at the end of 2021, up over 20 per cent on the previous year, and now representing more than a third of those without jobs.