The rate of employment growth in the economy has droppped off significantly in a worryingly development for the Government.
The latest Quarterly National Household Survey showed employment growth, a key measure of the economy’s health, fell to just 0.1 per cent during the first quarter of the year , resulting in the creation of 1,700 new jobs.
This follows employment increases of 10,600, 19,000, 12,700 and 16,300 in the previous four quarters, and suggests a major slowdown in the rate of job creation.
Widely regarded as the most reliable set of numbers on the economy, the survey, compiled by the Central Statistics Office (CSO), put the overall unemployment rate for the quarter at 12 per cent, down from 12.2 per cent in the previous quarter, and equivalent to the euro zone average.
However, the headline figure failed to match the 11.8 per cent estimated in monthly Live Register data.
A breakdown of the figures showed employment grew by 2.3 per cent or 42,700 in the year to the first quarter of 2014, reflecting the surging level of job growth witnessed last year.
This saw the economy’s overall jobless total fall by 33,900 or 11.6 per cent over the year, bringing the total number of people unemployed in the economy to 258,100.
In tandem with this, the long-term unemployment rate decreased from 8.4 per cent to 7.3 per cent over the year
The figures showed long-term unemployment accounted for 60.5 per cent of total unemployed number, compared with 61.8 per cent a year earlier and 63.5 per cent in the first quarter of 2012.
The total number of persons in the labour force in the first quarter of 2014 was 2,146,300, representing an increase of 8,800 or 0.4 per cent over the year.
The number of persons not in the labour force was 1,450,200, a decrease of 6,800 or 0.5 per cent over the year.
Mark Fielding of the Irish Small and Medium Enterprise organisation (Isme) expressed concern at the reduction in the rate of job creation and called on the Government for “renewed vigour” on the job’s front.
“There is little point in the Government encouraging job creation if the business environment is brutalised by high costs and hampered by an over-generous welfare system, which rewards inactivity.”
“While these issues have been well flagged for a considerable period, little progress has been made, other than the provision of additional training courses and back to work schemes, which on their own, will not create jobs,” he said.
Conall Mac Coille, chief economist at Davy Stockbrokers said: “The upward revision in the unemployment rate to 12 per cent looks a little disappointing, as does the marginal 0.1 per cent jobs gain on the quarter - especially given exceptionally strong surveys of companies’ employment intentions .”
“But excluding an erratic fall in part-time work, the underlying picture of strong improvements remains. We’re still confident that the Irish labour market is improving but today’s data don’t provide the headline-grabbing figures the gGovernment might have hoped,” he said.
Employers’ group Ibec said despite the slow down, the companies remain confident in Ireland’s economic development and continue to hire.
“An improving labour market should translate into greater consumer spending and further positive knock on effects across the economy,” Ibec economist Brian Mandt said.
