JOB VACANCIES in the private sector have hit their lowest rate in more than two and a half years according to the Fás/ESRI employment and vacancies survey for February.

The vast majority of construction employers also expect to cut staff numbers in the coming months. At 10 per cent the rate of job openings is at its lowest since August 2005 and is down from the February 2007 level of 12 per cent.

The decrease in vacancies across the economy is being driven by construction and services which fell to 8 per cent and 10 per cent respectively. Year-on-year the vacancy rate in the building sector is down five percentage points while the services sector is down six points.

The number of open jobs in the industry sector increased two percentage points to 15 per cent, the same level as this time last year. The level of vacancies in the retail sector is 9 per cent - the highest it has been since June 2004. This compares to 2 per cent in February 2007.

Despite the current tight labour market, employers are marginally more optimistic than pessimistic about increasing employment in the coming months. The net employment expectations indicator rose by 12 percentage points to 1 per cent. This means the number of employers expecting to increase staff numbers is one percentage point higher than that planning to reduce numbers.

The ESRI said the improvement in employer outlook, which is being driven by the services sector, "needs to be interpreted with caution" as it may be due to a monthly fluctuation in the data. The three-month moving average for this indicator, which smooths out monthly fluctuations, is minus -7 per cent.

Construction employers have the least positive outlook at -31 per cent. This follows a downward trend in outlook for the sector since February 2004 when the figure was -4 per cent.

The most frequently reported difficult-to-fill vacancies in the economy include quantity surveyors, general operatives, sales personnel, engineers, mechanics, accounting and architecture personnel.