Industrial employment is rising according to new data, despite high-profile factory closures earlier this year.

The latest Central Statistics Office (CSO) index of industrial employment confirms that, when adjustment is made for seasonal factors, 240,500 people were working in the sector last March.This is up 2,300 on December and 2,400 higher than in March 2005.

Despite strong growth in total employment in recent years, industrial employment peaked in 2001 and declined continuously until the middle of last year. But the latest figures suggest the beginning of an upward trend.

A detailed breakdown of the figures shows job losses continued in more traditional industries, such as food manufacturing and textiles, but these were more than offset by job gains in high-technology sectors such as the manufacturing of chemicals, computers and electrical equipment.

Ibec senior economist Fergal O'Brien welcomed the figures. "The improved employment situation represents a welcome respite for the manufacturing sector, which has been under considerable competitive pressure in recent years."

But he said a return to job losses would be inevitable unless action was taken to correct rising prices in the economy. "Our cost base continues to rise faster than that of our main trading partners and, unless this is controlled and our productivity performance improved, further job losses are inevitable," Mr O'Brien said.

CSO data on earnings and hours worked in construction, also published yesterday, show that, while hourly pay rates rose annually by 2.8 per cent last March, the number of hours worked fell by 1.8 per cent. As a result, weekly earnings in the sector rose by just 1 per cent.