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Unemployment rate may reach all-time high of 26pc this month


Dermot O’Leary: predicting unemployment of up to 26pc

Dermot O’Leary: predicting unemployment of up to 26pc

Dermot O’Leary: predicting unemployment of up to 26pc

The unemployment rate is set to reach an all-time high this month as the coronavirus continues to wreak economic havoc, it has been warned.

Economist at Goodbody stockbrokers Dermot O'Leary said official figures to be released next month are likely to show that the portion of the labour force out of work in April climbed to up to 26pc.

The highest point it has ever reached was 17.3pc in 1985, while the peak during the recession was 16pc.

Figures released last week showed the unemployment rate has already reached 16.5pc when those unemployed as a result of the virus are included.

Although many hope that the current lay-offs will be temporary and people will return to work when the crisis ends, there are fears that some companies may not reopen.

Debenhams announced last week that it is heading into liquidation and its 11 Irish stores will remain closed after the Covid-19 lockdown.

"Based on the number now on the pandemic payment, the unemployment rate could go as high as 25pc or 26pc when it is published next month," said Mr O'Leary. "The Central Statistics Office will publish two different rates - the standard and the emergency. If you include the emergency, it could rise up to 26pc and that does not include the numbers on the wage subsidy scheme."

There are now 714,000 people on unemployment benefits following an unprecedented surge in claims for support.

Some 507,000 of them are getting the Covid-19 Pandemic Unemployment Payment of €350 a week.

Another 207,000 people are on standard Jobseekers' Benefit of €203 a week.

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In addition, there are 219,000 workers who have avoided lay-off as their employers have availed of a State scheme that funds 70pc of their wages.

There have also been 23,800 applications for an enhanced Illness Benefit payment for those in self-isolation or diagnosed with the virus.

There are roughly 492,000 workers - one in five workers - who were employed at firms that the Government ordered to close but who cannot work from home.

They are more likely to be young men, although women make up most of the workforce in some of the hardest-hit sectors, including retail.

Roughly 80pc of the 219,000 workers who have received payments under the wage subsidy scheme have also received a top-up payment from their employer.

Retail and wholesale workers make up the biggest portion of workers availing of the scheme, followed by workers in manufacturing, accommodation and food services.

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