Cowen in firing line as unemployment soars

Taoiseach Brian Cowen faced another blistering attack over the handling of the economy today after devastating new figures showed dole numbers rose for the seventh month in a row.

The numbers signing-on almost doubled in the last year marking the biggest annual rise on record with 11.4% of the workforce now unemployed.

As the ESRI worryingly predicted the jobless rate would hit 17% next year, Cowen described it as an unfortunate by-product of a crumbling economy.

“In the context of an economy that is contracting by 8% this year, of course, unfortunately, unemployment will be growing,” Mr Cowen said.

“There is a global recession. The Singapores and the Koreas and the other famous Asian economies are contracting by 10% and more this year.

“Yes, there are more than 380,000 unemployed but every one is one too many as far as I am concerned.”

However, business chiefs branded the losses atrocious and demanded a national jobs strategy, while the Opposition claimed the Government was paralysed and could not act.

The CSO showed that while 188,850 more people signed on during the last year – a 96.6% increase – the rate of redundancies continued to ease last month.

While on average 1,000 jobs were being slashed every day in January and February, that figure dropped to about 500 a day in March and dipped slightly again in April.

However, despite the fall-off, a massive 13,177 extra people signed on last month.

Business body ISME called for the introduction of an emergency employment action plan to tackle the crisis.

The association said the Government must face-up to what it dubbed the labour market mess.

ISME chief executive Mark Fielding said: “The recent Budget and Government inaction has indicated an unwillingness to address the ongoing problem, which continues to deteriorate.

“What is required is less Government bickering and more Government action to address the biggest economic crisis since the State’s foundation.”

In the Dáil, Labour Party leader Eamon Gilmore asked how many more people would have to lose their jobs before Mr Cowen stepped down.

“Do you still believe that the economic crisis is nothing to do with you, that it is something that has appeared like the Mexican swine flu, out of the blue and nothing to do with how the Government puffed the property bubble,” Mr Gilmore said.

He added the country was facing the prospect of a half-a-million people out of work by the end of the year.

“More and more people are losing their jobs, more and more businesses are going to the wall while you and your Government are just stuck like the rabbit in the headlights, absolutely frozen and unable to act.”

Cowen denied his Government was complacent.

He insisted the ESRI’s latest report – which showed the Irish economy was contracting faster than any other country in the developed world – accepted the Government was taking corrective action.

Richard Bruton, Fine Gael’s Finance spokesman, said the nation’s confidence was being sapped because the Government had no jobs strategy.

Referring to the local and European elections in June, he told the Taoiseach: “That’s nothing like the fury you will encounter from ordinary people who are seeing the prospects of their lives and their children going up in smoke.”

“Everybody is saying that your Government who led us into this cannot lead us out of it. The Green Party is saying it and more and more people are saying it in your own Government.”

The CSO report revealed another 9,300 males and 6,600 females signed on during April – a larger proportion of women than in previous months.

The Ulster Bank said this was evidence of rising unemployment in the female-dominated services sector.

Lynsey Clemenger, economist, forecast the jobless rate would breach the 500,000 mark by the end of the year.

“While today’s figures were somewhat better than we had expected, it is important to not lose sight of the fact that the numbers signing on will continue to rise in coming months, as job losses in the services sector, most notably in wholesale and retail and hotels and restaurants, are ongoing,” Ms Clemenger said.

However, she added the fall-off in the rate of job losses signalled that the recent extreme unemployment projections could be over-negative.

“Today’s figures show unemployment will continue to be a major problem this year and next, but they also indicate that some of the extreme unemployment forecast of late may be unduly pessimistic,” she said.

The ESRI will tomorrow host a conference on the crisis-hit labour market.

Five presentations will be given by economists from both the ESRI and the OECD.