LIVE REGISTER:UNEMPLOYMENT ROSE sharply last month, with the number of people claiming jobseekers' benefits increasing by a record 36,500 in January.
There are now 326,100 people on the seasonally adjusted Live Register of unemployment benefit claimants, an increase of 80 per cent on this time last year. Further heavy job losses are expected.
The Taoiseach told the Dáil yesterday that the number of people joining the dole queues would breach 400,000 this year, although it is feared that if the pace of layoffs continues, the number of claimants could exceed 500,000 by the end of 2009.
The estimated unemployment rate jumped to 9.2 per cent, up from 8.3 per cent last month and 5 per cent a year ago, according to the Central Statistics Office.
Economists said yesterday the figures showed Ireland’s economy was “in crisis mode”, while Fine Gael leader Enda Kenny said the figures were “catastrophic” and amounted to an “employment bloodbath that would have horrific social consequences”.
The total number of unemployment benefit claimants is now at its highest point in the history of the State, with the Live Register set to be further inflated in the coming months as the impact of recent job cuts at Dell, Waterford Crystal and Ulster Bank add to the spiralling number of lay-offs.
Yesterday was another bad day for the labour market, as pharmaceutical group Boston Scientific announced the closure of its plant in Letterkenny, Co Donegal, with the loss of 120 jobs. IBM also said it would seek 120 voluntary redundancies from its operation in Mulhuddart in Dublin.
The escalating number of people signing on will exert further pressure on social welfare offices where a backlog of claims has built up.
The newly unemployed already face delays of up to 12 weeks before they receive their first jobseekers’ benefit payment, while the average waiting time for first-time claimants to receive the payment, worth €204.30 a week, is between 2½ and five weeks.
The increase of 146,500 claimants over the past year is estimated to have cost the exchequer €2.9 billion in welfare payments and lost tax revenues.
It will put further pressure on the struggling State finances.
The Labour Party said the Government had become “fixated” on addressing the exchequer deficit through spending cuts rather than tackling the causes of the deficit, which include the haemorrhaging of jobs from the economy at a rate of 1,500 a day.
All sectors of the economy have been affected by recession.
“We expect that job losses in construction and related industries will be ongoing in coming months.
“However, we also expect a more pronounced decrease in employment in the services sector, particularly so in wholesale and retail, and financial and business services,” said Lynsey Clemenger, economist at Ulster Bank.
Alan McQuaid, economist at stockbroking firm Bloxham, said the Live Register numbers were “simply horrendous, underlining the fact that the Irish economy is now in crisis mode”.
He added that the labour market was likely to get worse before it gets better.
The Irish National Organisation of the Unemployed said it was concerned that the level of investment needed to create future employment prospects would not be forthcoming.
Employers’ group Ibec called on the Government to divert funds from the National Development Plan to help businesses suffering as a result of global recession and the weak sterling exchange rate.
Ibec economist David Croughan said this latter was making exporting goods to the UK “almost impossible” and would lead to job losses “on a massive scale”.
