The unemployment rate has fallen to its lowest level since April 2008 — and economists are predicting that the rapid growth in employment is far from over.
The latest employment figures from the Central Statistics Office show that the seasonally-adjusted total number out of work was 133,800 in August, down 5,100 compared to July.
Alan McQuaid, economist with Merrion Fixed Income, said the total figure is much lower than his organisation had anticipated and means the unemployment rate now stands at 5.6%.
“The August jobless rate was the lowest since April 2008 and an almost ten-and-a-half percentage point improvement from the peak of 16% hit in January/February 2012 during the financial crisis,” said Mr McQuaid.
Furthermore, Ireland’s jobless rate remains over two-and-a-half percentage points below the current Eurozone average of 8.2%.
Employment rose in 10 of the 14 economic sectors in the second quarter of 2018, with construction up 13.9% or 17,800 and accommodation and food service activities up 10.8% or 17,300.
Mr McQuaid said that while emigration has been a factor to some degree in keeping unemployment down since the financial crisis, “the labour market has improved dramatically over the past few years, reflecting the strengthening of the economic recovery”.
“Indeed, the latest migration estimates showed net inward migration of 34,000 in the year to April 2018 as against net inward migration of 19,800 in 2017, and the highest net inflow since 2008,” he added.
Concern has been raised, however, about youth unemployment which remains high at 13.9%, though it has fallen from 16.4% since August 2016.
Mr McQuaid pointed out that significant progress has been made on that front in recent years, but he said a lot more needs to be done. He called for Government initiatives in terms of training and education to be focused in that area in particular.
Overall though, the expectation is that the jobless total will continue to fall further as the year goes on.
The rise in employment appears far from over,” said Mr McQuaid.
“The latest Labour Force Survey figures showed that the participation rate stood at 62.3% in the second quarter, compared with a pre-recession peak of 66.7%. Greater participation should slow down the fall in the jobless rate. There was an average net jobs rise of 61,300 in 2017. As regards 2018, another positive year for the labour market is envisaged, with the net jobs gain forecast at 68,000. Meanwhile, the average unemployment rate is, based on these latest updated CSO numbers, now projected at 5.7%, down from 6.7% in 2017.”