The number of people in employment fell by 108,000 or 5.5 per cent in the year to the first quarter of 2010, according to the Central Statistics Office (CSO).
The decline in the numbers in work has slowed down, the latest Quarterly National Household Survey (QNHS) shows.
There was also a quarterly decrease of 7,300 in the number of people unemployed, once seasonal factors are taken into account. This meant that Ireland’s official unemployment rate decreased from 13.3 per cent to 12.9 per cent over the quarter.
The unemployment rate has fallen partly because there has been a contraction in the size of the labour force - people of working age who are in work or actively seeking work. The labour force fell by 55,700 or 2.5 per cent in the year to the first quarter and now stands at 2,132,700.
On an annual basis, the number of people officially unemployed is up 52,200 - or 23 per cent - to 275,000.
This annual jump in unemployment has moderated since 2008, hinting at some signs of stabilisation in the economy.
Once again, the downturn in the construction sector continued to account for most of the male job losses according to the government’s statistic agency.
However, the number of people in long-term unemployment has doubled since the first quarter of 2009 and now stands at 112,600 or 5.3 per cent.
A quarter of people aged 20-24 were unemployed in the first quarter. At the peak of the labour market two years ago, this rate stood at 8 per cent.
The bulk of the decline in the labour force is due to a decline of 38,800 in participation - whereby people return or stay on in education, look after children or otherwise stop seeking work.
When people who are classed as being outside the labour force (and not, therefore, officially unemployed) but who also show some interest in obtaining work are taken into consideration, the rate of unemployment increased from 14 per cent in the first quarter of 2009 to 17 per cent in the first quarter of 2010.
Negative demographic effects, mainly net inward migration, also reduced the size of the labour force by a further 17,000.
The non-Irish national labour force has declined by 53,500 or almost 16 per cent over the year, according to the CSO’s estimates. There was an estimated 402,700 non-Irish nationals over the age of 15 in the State in the first quarter of 2010, down 59,600 or 12.9 per cent annually.
The fall in the numbers of non-Irish nationals in the labour force has accelerated over the course of the year.
For the first time, the CSO has included details on the employment status of early school-leavers. In the first quarter of 2010, 30 per cent of early school leavers aged 18-24 were unemployed, compared to 13 per cent of people who had completed secondary level education.
Ictu economic advisor Paul Sweeney claimed Ireland's true unemployment rate could be close to 20 per cent.
Mr Sweeney claimed the data significantly underestimated the numbers out of work and the scale of the social and economic devastation in communities across the country.
"When you add in the tens of thousands who have been forced to emigrate, the tens of thousands who have stayed in or returned to education for the same reason and the many thousands who want full time work but can only get part time or casual jobs, you get a more accurate picture of the scale of the problem and
its huge social impact," said Mr Sweeney.