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Economy will 'take off like a rocket' after Covid-19 despite soaring job losses and business closures, Varadkar insists

 

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Tánaiste Leo Varadkar

Tánaiste Leo Varadkar

Tánaiste Leo Varadkar

Tánaiste Leo Varadkar has said he expects the economy to "take off like a rocket" after the pandemic.

He was speaking as new figures revealed the number of redundancies planned by employers more than doubled last year.

Employers notified the Enterprise Minister of 11,744 redundancies between March and the end of 2020.

This compared with 5,007 proposed job losses that were notified during the same period in 2019.

Under employment legislation, employers proposing collective redundancies must flag them with the minister.

Mr Varadkar said the numbers would have been much higher if the Government had not put an economic rescue package in place.

This included wage subsidy schemes, the Pandemic Unemployment Payment (PUP), grants, a commercial rates waiver and low-cost loans.

The latest figures show there are more than 475,000 people on the PUP and another 189,860 on the Live Register.

Many of these workers have been laid off because of Government-ordered shutdowns, so have not been registered as potential redundancies.

Thousands of others have had wages propped up by a State subsidy scheme.

"We know last year was a really difficult year," he said.

"Any redundancy is personally devastating for the individual and I know there is a family behind each one of these figures."

He said there will be an increasing focus on education and training opportunities for people who want to change careers, even temporarily.

"I believe the Irish economy will take off like a rocket once the pandemic ends and we will be able to return to low levels of unemployment again within a few years," he said.

Economist Jim Power noted that the redundancy figures are significantly lower than the 470,000-plus people on the PUP, or the 598,000 on the payment at the peak last May.

"I think the redundancy figures obviously show a significant deterioration but the magnitude of that deterioration without PUP and the wage subsidy would have been catastrophic," he said.

"However, it is extremely expensive and listening to the Taoiseach at the weekend, I wouldn't be full of confidence of any turnaround any time soon.

Lucky

"Inevitably in 2021 we will see another significant increase in those redundancy figures.

"Many businesses will decide there is no point going on."

Economist Alan McQuaid said he expects the unemployment rate, which stood at around 4pc before the pandemic, will remain in double digits after subsidies are withdrawn.

"We've done better than we thought," he said.

"We are lucky to have pharma and tech firms but you can't dismiss the fact that the biggest employers are SMEs and they're the ones suffering."

He said the biggest job losses are likely in hospitality and pubs, but construction will be buoyed up by demand.


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