Unemployment has grown for the first time in five years, according to the latest figures from the Central Statistics Office (CSO).

The latest Quarterly National Household Survey showed that there were 79,500 people unemployed in the June-August quarter, a rise of 1,800 on the corresponding quarter of 2000. It was the first annual rise in the numbers unemployed since April 1996 and compares sharply with the annual decline of 9,500 recorded in the second quarter of 2001.

The number of unemployed rose by 14,100 between the second and third quarters of 2001. While unemployment tends to rise in the summer months due to seasonal factors, the quarterly rise was substantially larger than the increases of 4,200 and 2,800 recorded between the second and third quarters of 1999 and 2000 respectively, according to the CSO.

Almost all of the quarterly rise was accounted for by the rise in the number of unemployed persons under 25 years of age. The unemployment rate was 4.3 per cent in the third quarter of 2001, compared with 3.7 per cent in the previous quarter and 4.3 per cent in the corresponding quarter of 2000.

However, the survey was completed too early to have been affected by the events of September 11th, while the more recent job-loss announcements will not be officially recorded until the release of fourth-quarter data by the CSO in February.

Overall, there were 1.79 million people in employment, a rise of 48,700 in the year. Although the figures show that employment continued to grow at 2.8 per cent - approximately the same as in the second quarter - it was below the 4.1 per cent recorded between the third quarters of 1999 and 2000. Meanwhile, the labour force rose by 50,500 in the year to 1.87 million.

The annual rise in unemployment reflected an increase of 5,300 to 57,200 in the numbers of short-term unemployed, according to the CSO.

This figure was partially offset by a fall of 3,600 to 22,100 in the numbers of long-term unemployed. The numbers in full-time employment grew by 34,900 to 1.49 million, while part-time employment rose by a proportionately greater 13,800 in the year to 291,700.

The vast majority of this increase was for females who account for three-quarters of those in part-time employment. Almost 50 per cent of women living with a husband/partner in a family unit with children were in employment in June-August compared with 43.6 per cent three years earlier.

The numbers working 35-39 hours a week rose by 35,600 and the numbers working 40 hours or more fell by 13,900 in the year to the third quarter.

The average working week was 38.2 hours in the third quarter of 2001 compared with 38.4 hours in 2000 and 38.5 hours in 1999.

On a regional level, employment grew by 4.9 per cent in the Border, Midland and Western region, while there was a 2.1 per cent growth in the Eastern and Southern region. The numbers of people unemployed rose slightly in both regions, while it remained the same in the West and Dublin regions and fell in the remaining three regions.

The unemployment rate was highest in the Border region at 6.8 per cent and lowest in the Dublin and Mid-East regions at 3.3 per cent and 3.5 per cent respectively.

Employment growth varied between sectors. Education and health employment grew by 15,600, financial and other business services by 11,900, construction by 10,900 and transport, storage and communication by 6,700.

The numbers engaged in agriculture, forestry and fishing fell by 3,400, while employment in the hotels and restaurants sector was down by 2,000.

"It would be an indication of foot-and-mouth effects," CSO director Mr Gerry O'Hanlon said. "The decline in employment in the hotels and restaurants sector was maintained in the summer quarter."

Employers' organisation IBEC said the latest figures reaffirmed its estimate that unemployment would average 4.1 per cent in 2001, rising to 4.9 per cent in 2002, reflecting a combination of more difficult trading conditions and lost competitive ground in terms of labour costs.

"In order to maintain jobs and job growth, it is important to address the deterioration in labour cost competitiveness. In recognition of this, Government must reduce the rate of employers' PRSI in next week's Budget," said Mr Aebhric McGibney, senior economist at IBEC.

Ms Noeleen Hartigan, welfare to work coordinator of the Irish National Organisation of the Unemployed (INOU), said the figures were a stark reminder to the Government of the current economic situation.