THE MAIN Opposition parties have demanded direct action from the Government to stem the rising tide of unemployment, following official figures yesterday which showed the highest year-on-year increase since records began
The numbers signing on the Live Register for unemployment benefits have climbed to a 10-year high this month. The figure has jumped by 17,429, or 7.9 per cent, in July alone to 238,240, according to figures published yesterday by the Central Statistics Office. That is the highest Live Register total since February 1998.
The data undermines the Government's recently revised forecast that the numbers on the Live Register would average 210,000 during 2008, although officials at the Department of Finance said there would be no further revisions or comment until publication of exchequer returns for the third quarter in September.
The figures were published as Ireland's largest bank, AIB, said it had cut 600 jobs in a bid to cut costs as profit falls.
Chief executive Eugene Sheehy said the bank had not replaced 350 permanent staff who left this year and was no longer employing 300 external IT consultants. "Effectively we are cutting jobs because we are not replacing people, unless it's a real specialism that we don't have a replacement for," Mr Sheehy said.
The Live Register data signals a continuation of the severe deterioration in labour market conditions seen since the beginning of the year. On a seasonally adjusted basis, the numbers on the Live Register increased by 10,600 to 226,000 during July.
As a result, the unemployment rate - the numbers out of work as a percentage of the labour force - has risen to 5.9 per cent in July from 4.5 per cent a year earlier. The unemployment rate last touched 5.9 per cent in April 1999.
Mr Sheehy said he expected the unemployment rate to reach 7 per cent and economic growth to remain flat this year and next. He said the economy would not recover until 2010.
The Fine Gael spokesman on enterprise, trade and employment, Dr Leo Varadkar, said Ireland's unemployment rate "cannot be blamed on the global economic situation. Ireland now has higher unemployment than the United States (5.5 per cent), Britain (5.25 per cent), Japan (4 per cent), Austria (4.1 per cent), The Netherlands (4 per cent), Denmark (1.7 per cent), Norway (2.5 per cent and the Czech Republic (5 per cent).
"These figures would be much worse were it not for the large number of immigrants who are leaving the country. The time for wake-up calls has long passed," Dr Varadkar said.
Labour's enterprise spokesman Willie Penrose said the figures were truly shocking.
"Since January, the dole queues have been growing by 1,500 per week, but the Government has shown no sign of having any plan, or any sense of urgency," he said.
Since the start of this year, 53,600 people have been added to the Live Register total, an increase of 31.1 per cent. More than seven out of 10 new benefit claimants so far this year are men. This increase in male unemployment reflects principally the steep downturn in house building and construction activity.
The number of women claiming unemployment benefits has risen by 15,400 since the start of the year, with most of the increase concentrated in the last three months. This indicates that the slowdown is spreading from construction to the services sector, where most women work.
The scale of the recent increase in benefit claimants will add to the Government's difficulties in containing its current spending this year. It costs the Government €11 million to finance unemployment benefits for every 1,000 claimants for a full year.
The numbers on the Live Register have averaged 203,600 in the first seven months of the year. In order to attain its revised target of 210,000 for 2008, the Government would have to contain the numbers on the register to an average of 219,000 for the remaining five months of 2008.
This would require that the monthly Live Register totals for the rest of 2008 were substantially lower than the 238,200 recorded in July. In the current economic climate, this is a highly unlikely outcome.