Republic’s unemployment rate revised up to 4.1%

The headline rate of unemployment in the Irish economy last month was put at 4.1 per cent, down from 4.2 per cent in June, according to the Central Statistics Office (CSO) on Wednesday. A provisional estimate of unemployment in June, published last month, had put the headline rate at an all-time record low of 3.8 per cent.

However, the CSO has revised up the rates for April, May and June on the back of its latest labour force survey. A spokesman said the provisional 3.8 per cent estimate was a forecast based on the previous labour force survey and the most recent live register data and subject to revision.

Economists consider an unemployment rate of 4 per cent or less in the Irish labour market as tantamount to full employment.

The CSO said the seasonally adjusted number of people classified unemployed was 111,900 in July, compared with 115,500 the previous month. The youth unemployment rate was also revised up to 10.7 per cent, from a rate of 10.5 per cent in June.

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[ Youth jobless rate ticks up as overall unemployment stays at record low of 3.8% in June ]

Despite the revisions, the Irish labour markets remains “incredibly tight”, said Jack Kennedy, economist with recruitment site Indeed.

“The continuing low level of Ireland’s unemployment rate reflects the culmination of concerted efforts by both the public and private sectors to foster a robust and sustainable economy,” he said.

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The data for Ireland comes in the wake of Eurostat figures on Tuesday, showing unemployment in the euro zone dipped to an all-time low of 6.4 per cent.

European Central Bank policymakers are worried that wage pressures from tight labour markets across Europe are keeping core inflation – a gauge that strips out energy and food prices – elevated.

“Pay pressures remain strong and workers will push for higher wages to compensate for high inflation,” Mr Kennedy said.

[ Unemployment remains at two-decade low of 4.3% ]

Separate CSO figures indicated that underlying or core inflation rose from 6.8 per cent to 7.1 per cent in June.

The main driver was higher mortgage interest costs, which were up by 46 per cent on an annual basis on the back of eight straight interest rate hikes by the ECB.

The bank added a further interest rate hike in July, the ninth since this time last year and the most aggressive series of monetary tightening ever undertaken by Frankfurt.