This has been the worst year for redundancies since the mid 1980s, the Small Firms Association (SFA) claimed yesterday.

In its end of year statement SFA director Mr Pat Delaney said employment prospects were in a "perilous" state going into 2004. He said monthly increases in unemployment were accelerating, the number of hours worked was declining and the ability of the economy to create jobs was threatened by increasing costs.

The redundancy figures notified to the Department of Enterprise, Trade and Employment were up to 24,875 for 2003. Mr Delaney said this was further proof the economy was in free fall.

"Small companies continue to engage in cost cutting measures in an effort to survive the economic down turn. A spiralling cost base in areas such as labour, insurance, energy, commercial rates and service charges have all played their part in putting increased pressure on business survival.

"We expect to see further erosion of jobs in 2004 as investment and business confidence remains weak. The expected upturn in the international economy may take some time to benefit the small business sector," he added.

"The continuation of exchange rate volatility in 2004 which sees the euro strengthen against sterling and the US dollar may impact severely on exports, as Irish input costs remain relatively high to competitors. Ireland needs to see significant and continuous cost reductions and wage moderation if we are to protect existing employment. The loss of 11,000 manufacturing jobs in 2003 is further evidence of how badly exposed we are," he said.

"In the 11 months from January to November 2003, the level of redundancies is already 5.4 per cent ahead of last year. This year has been the worst year for redundancies since 1984. We have been losing a job every 20 minutes and an average of 518 jobs every week in 2003," Mr Delaney pointed out.