|Source: CSO |Irish Live Register: The numbers on the Live Register increased in August by 9,100 to 235,100 though the rise was not as big as in the previous two months, according to the CSO. In the year to August 2008, there was an unadjusted increase of 73,178 (+42.0%) - the highest in any year since 1967. The standardised unemployment rose to 6.1% in August.
The unadjusted increase was 63,647 (+36.5%) in the year to July 2008.
Other features include:
The monthly increase in the seasonally adjusted series consisted of an increase of 7,400 males and an increase of 1,700 females.
The standardised unemployment rate in August was 6.1%. This compares with 5.1% in the second quarter of 2008, the latest seasonally adjusted unemployment rate from the Quarterly National Household Survey.
In the month, the estimated number of casual and part-time workers on the Live Register was 12,047 males and 14,921 females.
The Live Register is not designed to measure unemployment. It includes part-time workers (those who work up to three days a week), seasonal and casual workers entitled to Jobseekers Benefit or Allowance. Unemployment is measured by the Quarterly National Household Survey and the latest seasonally adjusted figure, for March to May 2008, is 115,100 persons unemployed.
IBEC Director General Turlough O'Sullivan today said he was looking forward to meeting the Taoiseach on Friday next to discuss the economy and the prospects for reviving the national partnership process.
O'Sullivan reiterated his comments of last week that the economy was now in a much weakened position with all sectors struggling to come to grips with the major challenges including the credit crunch, the costs of doing business including energy, the dramatic downturn in construction and consumer confidence, currency pressures and competition from lower cost economies.
O'Sullivan concluded that it was urgent that all parties work together to safeguard the maximum number of jobs. The latest live register figures confirm the seriousness of the situation as the rate of unemployment has risen to 6.1% of the labour force. If people have jobs they are so much better placed to ride out the current crisis. It is therefore incumbent on all to deliver a new agreement that is moderate and underpins job security.
Rossa White, economist at Davy commented: "We get an unwelcome feeling of déjà vu each time the Live Register is released. The number of unemployment benefit claimants jumped again in August, this time by 9,100 or 4%. Claimants have been rising at an annualised pace of 50%+ all year.
The August increase followed gains of 10,600, 8,600 and 7,600 in the three previous months.
Construction layoffs still dominate, but the process is not even halfway complete
Males are still joining the Register at a faster pace than females, suggesting that layoffs in construction are continuing at a strong rate. According to our estimates, we are not even halfway through the secular shakeout in construction jobs.
Yet the steady rise in female claimants also tells us that the service sector is now struggling.
Current unemployment rate probably overestimated at 6.1% but is heading inexorably towards 8% by end-2009
The estimated unemployment rate was 6.1% in August, but the Register has been overestimating the rise all year. Official unemployment data are released with a lag in the Quarterly National Household Survey. Immigration is slowing, leading to a decline in the labour force. As a result, we suspect that the rate is actually 0.1-0.2pp lower. We will not know for sure until the Q3 data become available in November.
Either way, it is something of a moot point because the unemployment rate may reach 8% by end-2009."
Pat McArdle, Chief Economist at Ulster Bank commented: "The August Live Register figures came in at the high end of expectations confirming the sharp deterioration in the economy over the Summer months. The seasonally adjusted total of 235,100 was up 9,100, the third largest monthly rise this year. It compared with a consensus expectation of 232,000 in the Reuters monthly survey (UB = 235,000).
The Live Register was last at this level in March 1998. However, it was the annual increase of 73,000, the largest in the history of the series which dates back to 1967, that captured the headlines. However, such comparison do not take account of the doubling in the size of the labour force in the meantime. The Standardised Unemployment rate is, therefore, a better measure of the real situation. It rose from 5.9% in July to 6.1% in August. It last reached 6.1% in December 1998, i.e. half way through the Celtic Tiger boom period. The 0.3% points increase between July and August was equalled in July and March but indicates that the pace of deterioration has stepped up recently. It remains to be seen whether outward migration will ease the situation later in the year. So far, it appears that non-nationals are staying on the Register for the time being.
It is now likely that the December Live Register figure will be close to 270,000 and the average for the year will be above 220,000, i.e. more than 10,000 above the Government’s revised 210,000 estimate. This will add €100 million, plus, to the Social Welfare bill this year, compounding the pressures from underperforming tax revenue.
The monthly increase in claimants was 9,100 in July, with males accounting for 7,400, or 81%, of this total, the highest proportion of males since Dec 2007. The fact that males continue to make up the bulk of the monthly increase probably indicates that construction-related layoffs were high around the time of the builders’ holidays.
Females were up just 1,700, the lowest monthly increase since February if we exclude the distorted April data. This is at odds with the notion that unemployment is spreading but one month’s figures can be erratic.
The outlook is for further rises with te rate heading towards 8% late next year."