THE unemployment rate is at its lowest in over three years – but could rise again if VAT rates are hiked for restaurants and hotels, the Government has been warned.
After another fall in the numbers signing on, it is now down to 408,670, the latest Central Statistics Office figures show. This marks an unemployment rate of 13.3pc, the lowest rate since March 2010.
On a seasonally adjusted basis, the numbers on the Live Register fell by 1,800 in September – the 15th month in a row it has gone down. There are now 20,000 fewer people signing on than there were a year ago.
However, some of those could be taking part in government back-to-work programmes and internships as the CSO figures show there were 63,289 on those in August, over 5,000 more than a year ago.
People on these schemes are not included on the Live Register although they still receive a social welfare payment.
Tanaiste Eamon Gilmore said that the decline in numbers on the Live Register might have an impact on the forthcoming Budget.
"Yes, I think they will. The improvement in the Live Register figures is very good news, we need to see it continued," he said.
But the Irish Small and Medium Enterprises Association (ISME) warned that raising the 9pc VAT rate for the restaurant and tourism sector back up to 13.5pc would reverse the job gains and lead to losses.
"The tentative revival experienced in the economy so far will be undone if Finance Minister Michael Noonan goes ahead with his plan to reverse the 9pc VAT rate to its original 13.5pc," said ISME chief executive Mark Fielding.
The proportion of people out of work for over a year is also at its highest ever – 46.2pc of the total signing on – showing that government measures to get them back in the workforce were not working, he said.
The CSO figures show that long-term unemployment fell by under 4,000 in the last year whereas short-term unemployment fell by nearly 17,000.