Official figures have confirmed that the number of people on the Live Register hit a record high of almost 328,000 in January. The Central Statistics Office said the numbers signing on rose by almost 36,500 from December to 327,861. The Taoiseach told the Dáil this morning unemployment could reach 400,000 by the end of the year. The Live Register figure has now surged by more than 80% over the past 12 months. The seasonally adjusted figure rose by 33,000 to 326,100, while the unemployment rate jumped to 9.2%. up from 8.3% in December.
Bloxham's Alan McQuaid described the data as 'horrendous', and underlined the fact that the Irish economy was now in crisis mode. 'Apart from the sharp fall in construction employment, other sectors like manufacturing, retail, transport, and financial services are starting to significantly feel the pinch too,' he added. Davy said welfare payments would rise by at least €350m based on the last month alone, though the Government will get some of this back through taxes as that money is spent. The stockbroker expects the unemployment rate to reach 13% by the end of 2010.
The current 9.2% rate is the highest rate since December 1997. This is up from a low of 3.7% in February 2001, but remains below the average unemployment rate of 16% in the eighties.
Given that we expect the weakness in the labour force will accelerate in coming months, double-digit rates of unemployment will likely come sooner than we previously thought, and we now see the rate hitting 10% in coming months. This estimate takes into account a downward revision to the Live Register estimate of unemployment when the official unemployment figures are released in the Q4 Quarterly National Household Survey, as this measure does not include part-time workers who are eligible for unemployment benefits.
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