UNEMPLOYMENT RATE:IRELAND'S UNEMPLOYMENT rate passed the 10 per cent mark in February, with economists forecasting that the rate could be as high as 14 per cent by the end of the year.
A further 26,700 people joined the Live Register of unemployment benefit claimants, according to figures published by the Central Statistics Office yesterday, pushing the estimated unemployment rate into double digits for the first time since October 1997.
The standardised unemployment rate increased to 10.4 per cent in February, up from a revised rate of 9.6 per cent in January, as the Irish labour market continued to deteriorate.
It was another grim day for jobs yesterday, as accountancy firm KPMG cut 200 jobs from its Irish business and Bausch Lomb announced it was making 195 people redundant in Waterford.
The number of people on the seasonally-adjusted Live Register stood at 352,800 in February, up almost 88 per cent on the same month last year and 20 per cent on December. The number of claimants includes some part-time and seasonal workers who are entitled to State payments.
The small firms association Isme said “immediate action” was now required to stop the number of unemployment benefit claimants from further spiralling out of control, while business group Isme said the “dire” figures suggested that the economy was on the “brink of collapse”.
Isme said an emergency employment action plan needed to be introduced without delay. It repeated its calls for PRSI exemptions for employers who hire new staff, a reduction in the rate for existing staff, the setting up of an employment subvention fund to protect jobs, and workplace training subsidies for companies who cut the hours worked by staff.
The Irish Congress of Trade Unions said that the Government needed to adopt “radically new solutions” to the stem the accelerating rate of job losses.
The pace of layoffs continues to intensify, especially in sectors such as retail and financial services, with a higher number of male workers signing on, indicating that jobs are still being lost at a substantial rate from the collapsed construction sector.
Taoiseach Brian Cowen told the Dáil that the number of people unemployed in Ireland would exceed 450,000 this year if the current rate of job losses was to continue. A number of high-profile companies announced redundancies during February, including Ericsson, Elan, Grafton Group, Glanbia and Smart Telecom, with these cuts due to add to the numbers of people signing on in the months ahead.
The job losses will put further pressure on the beleaguered public finances, with each 10,000 workers on the Live Register estimated to cost the exchequer about €150 million in welfare payments and lost tax revenue.
Ulster Bank economist Lynsey Clemenger said a more “pronounced” rate of job losses in the services sector was imminent. There was also evidence of a trend whereby part-time workers were moving into full-time unemployment, as employers look to cut costs, said Ms Clemenger, who forecast a 14 per cent unemployment rate by the end of the year.
Rossa White, economist at Davy Research, said he expected the unemployment rate to breach 12 per cent by October, which would mean that the Irish unemployment rate would have jumped almost eight points in two years. The last country in the euro zone to see such a large jump was Finland in the early 1990s, he noted.
The Live Register is the latest in a series of gloomy jobs market statistics to emerge. Redundancies notified to the Department of Enterprise, Trade and Employment for the first two months of 2009 were 133 per cent higher than they were in the same period in 2008, it was announced on Monday.
Last Friday the CSO’s Quarterly National Household Survey for September-November 2008 showed that the number of people in employment fell by 86,900.
