Emigration central to unemployment figures, says economist

A leading economist has linked the falling number of dole claimants to the number of people emigrating — but forecast the unemployment rate could fall to 14% by the end of the year.

Alan McQuaid, chief economist with Bloxham, said it was good news that the numbers signing on the Live Register had dropped to 434,100 in March, 5,300 fewer than in the previous month. The figure marked a year-on-year drop of 7,100.

Mr McQuaid said the drop had contributed to a fall in the unemployment rate from 14.4% to 14.3%.

“It does appear as though the labour market has stabilised but it is clear that there is still a huge task facing the Government in bringing down the jobless rate on a sustainable basis,” he said.

The level of long-term unemployment remains a considerable concern.

There are now 184,465 long-term claimants on the register, 17,838 more than a year earlier.

“This rate of increase in long-term claimants has been slowing over the last twelve months or so with an annual rise of 57,597 (+55.9%) having been recorded in January 2011,” said Mr McQuaid. “Still, the number of long-term unemployed remains a cause for concern.

“In its most recent quarterly report on Ireland the team of European Commission/ECB/IMF inspectors said the long-term unemployment figures needed ‘considerable attention’.

“The Organisation for Economic Co-operation and Development (OECD) also expressed worry when highlighting the issue in its latest economic review of Ireland.”

He said while the latest live register figures continue to show improvement “it is clear emigration is playing a big part in keeping down the numbers signing on”.

“Many young Irish people are either staying on/returning to education or moving abroad to avail of significant job opportunities in the likes of Australia, New Zealand and Canada,” he said.

“The Fine Gael/Labour coalition is well aware that there is no easy fix to the unemployment problem.

“Recent economic trends/data have been encouraging. The average unemployment rate in 2011 was 14.4%, and we are looking for this to fall to 14.0% in 2012,” he said.