Jobless total hits highest level in three years

Unemployment increased by 2,000 in February, the fourth successive monthly increase. The seasonally-adjusted live register total rose to 169,000, according to figures published yesterday by the Central Statistics Office, bringing the unemployment rate to 4.5 per cent, its highest level in three years.

The unemployment trend now appears to be firmly upward, reflecting the slowdown in economic growth. The numbers of people on the live register last month was 9,057 higher than in February 2002, a 5.6 per cent increase over the year.

Of the 2,000 monthly increase, the breakdown of the CSO figures shows that 1,700 comprised people aged over 25, while there was a 300 rise for younger workers. Again adjusting for seasonal factors, male unemployment rose by 1,100 to 99,500 while female unemployment increased by 900 to 69,500.

The figures are the latest in a series of indicators pointing to difficult conditions in the jobs market. Most recently, last Thursday, new figures from the Department of Enterprise, Trade and Employment showed a 6 per cent increase to 4,264 in notified redundancies in the first two months of the year. There has also been a string of job loss announcements, most recently the 150 lay-offs at Pall Ireland in Tipperary announced earlier this week.

Exporting industry, in particular, is being hit by the rise of in value of the euro, which makes exports to non-euro countries more expensive.

The Central Bank's trade-weighted competitiveness indicator, which is an index measuring a basket of currencies of our trading partners, has risen by 9 per cent over the past year. This is particularly affecting firms exporting to the US and the UK, who are finding their competitive position has worsened sharply. Some analysts predict the euro could rise further.

Commenting on the figures yesterday, Friends First economist Mr Jim Power said that, given the poor economic conditions, the deterioration in the jobs market "is not bad and compares favourably with most of our EU partners". Figures this week showed that the German unemployment rate is now 10.5 per cent.

However, with the outlook remaining poor and exporting industry under pressure from the strength of the euro, Mr Power said the Irish unemployment rate could climb as high as 5.7 per cent by the end of the year.

Davy stockbrokers said the latest figures added to recent evidence of a declining jobs market. Survey evidence from manufacturing and services has predicted falling employment levels, they said, and figures from the CSO published earlier this week showed employment in the financial sector - formally a major job creator - falling slightly in the nine months to last September.

The brokers expect the unemployment rate to rise from 4.5 per cent "by at least a percentage point over the rest of the year".