Jobless costing State €690m more as extra 10,000 join dole
A MASSIVE €690m hole has been blown in the Government's finances after it emerged that over 63,000 more people had signed on the Live Register by last month than had done so by the same time last year.
Further confirmation of the economic slowdown was highlighted yesterday after new figures recorded the highest yearly change since Central Statistics Office (CSO) records began, more than 40 years ago.
The standardised unemployment rate is also on the rise, now standing at 5.9pc, with economists predicting it will climb to 7.5pc by the end of next year.
More than 238,000 signed on the live register this month, an increase of over 17,000 on June and 63,000 more than this time last year -- a jump of 36.5pc.
When adjusted for seasonal factors, the figures make just as grim reading: 226,000 signed on -- 10,000 more than last month and 63,600 higher than last year.
While the Live Register does not measure unemployment, because it includes those who are part-time or casual, it does include all those who want to work full-time, but cannot.
Recent government figures show that it costs the economy €11m for every 1,000 people on the Live register.
Based on that calculation, the yearly increase of more than 63,000 has hit the economy for another €690m.
A worrying feature of these latest figures is the increasing number of women on the register -- indicating the slowdown is now hitting other sectors, not just construction.
Last month, 80,600 women were on the register, an increase of 3,600 on the June figures, but 15,400 more than this time last year.
The figures were described as "frightening" by one employers body, which said the labour market was in "freefall"; while the Irish National Organisation of the Unemployed said the figures made for "stark reading".
Employers' body IBEC said the CSO figures highlighted the rapid deterioration in the labour market.
"In fact, Ireland has not witnessed such a rapid deterioration in the labour market since 1975," said IBEC economist Fergal O'Brien. "The unemployment rate of 5.9pc is the highest we have seen in a decade and, worryingly, is set to rise considerably before the end of the year."
Younger people were feeling the impact of the downturn most severely, with the numbers aged under 25 out of work having increased by 52pc in the past year.
In a message to the Government and social partners, Mr O'Brien said it was vital they accepted the full reality of the pace of the current downturn and said the first priority must be to stem the tide of rising unemployment.
ISME, which represents small and medium-sized companies, said it was alarmed at the rapid rise in the "bleak" live register figures and said they confirmed that a pay freeze in the public and private sectors was now needed.
Its chief executive, Mark Fielding, said the figures were "frightening" and that the labour market was in "freefall".
Fine Gael accused the Government of losing control of the deteriorating economic situation.
The party's enterprise spokesman, Leo Varadkar, said the Government must now ensure that any pay deal agreed with unions could be afforded by businesses and taxpayers and that a freeze on government and local authority charges must be imposed.
The Labour Party enterprise spokesman Willie Penrose said that a co-ordinated response was needed through FAS, the further-education sector, institutes of technology and other education and training agencies.