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News : Irish Economy Last Updated: Jan 19, 2015 - 3:01 PM

Ireland: Kenny gets sums wrong on jobs - missing 60,000
By Michael Hennigan, Finfacts founder and editor
Jan 15, 2015 - 8:01 AM

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Enda Kenny, taoiseach and Joan Burton, tánaiste, Government Buildings, Dublin, Jan 14, 2015

Ireland: A "Jobs Cabinet" on Wednesday sanctioned cutting the target date for full-employment by two years to 2018 but Enda Kenny, taoiseach, got his sums wrong by about 60,000 on the increase in employment needed to offset jobs lost during the recession, or as the announcement coupled with a press conference was part of the next general election campaign, the data was massaged to suit the message.

Enda Kenny told a meeting of Irish ambassadors in Dublin Castle also on Tuesday, in an echo of a predecessor's lament about economic "cribbers" in 2007: "The evidence of delivery is clear to all but the most committed begrudgers and eurosceptics," and in relation to the period before taking office, he said: "Two hundred and fifty thousand jobs were destroyed in just three years."

Kenny and Joan Burton, tánaiste,  at a press conference in Government Buildings said that employment in the economy would grow to 2.100m by 2018 and there would be full-employment.

Wonder what is full-employment? It could mean 210,000 unemployed people.

Let's deal with numbers first:

  • Additional jobs required from Q3 2014 to Q4 2018 is 173,000 with 40,000 targeted in 2015;
  • 80,000 jobs added in Q4 2011-Q3 2014 - from start of Action Plan For Jobs initiative;
  • Jobs from Q4 2011 to Q4 2018 to amount to 253,000, supporting Kenny's claim that all jobs lost in the recession will have been restored;
  • However, over 300,000 jobs were lost in both 2008-2010 and in 2008-2012 and timing the start of the 2008 recession in Q2 at 2.147m total jobs or Q3 at 2.136m does not materially impact the total. Jobs fell 53,000 in Q4 2008;
  • Enda Kenny, Fine Gael leader, campaigned in the February 2011 election on 300,000 job losses;
  • The Government's December 2013 'Medium Term Economic Strategy 2014-2020' [pdf] states on Page 43: "At its peak, employment in Ireland reached 2.16m people, before 330,000 jobs were lost between 2008 and 2012; the majority during the initial stages of the recession" note the total of "2.16m people" compared with the 2018 target of 2.100m - a difference of 60,000 jobs;
  • Kenny said at a press conference in December 2013 that the coalition "aims to replace all 330,000 jobs lost during the crisis with new jobs";
  • Enda Kenny used the 330,000  total in a speech in Washington DC in March 2014.

Our goal is that all of the 250,000 jobs that were lost during the recession will be able to be restored and that’s why, at the suggestion of both myself and the tánaiste, Cabinet agreed to bring forward plans from 2020 to be implemented by 2018 to achieve full employment,” Enda Kenny, taoiseach, speaking at press conference, Dublin, Jan 14, 2015.

Total jobs lost in 2008-2012 was at 307,000 not 250,000.

The full employment target has been brought forward two years and 60,000  jobs have been lost in the political propaganda. Using the total of 330,000, raises the missing numbers to 80,000.

“I don’t see it as a statistic. These are men and women who want to have the opportunity to go to work," Kenny said on Wednesday. "That means being on the employment ladder, being able to buy a car, the girlfriend, the boyfriend [something] or the boots or whatever and live a life as it were.”

Jobs lost in Ireland's recession 2008-2012

End Year Jobs 000s Change
2007 2,156
2008 2,083 -73
2009 1,921 -162
2010 1,857 -64
Three Years of losses -299
2011 1,848 - 9
2012 1,849 +1
Five years of losses -307
Source: CSO via Finfacts.ie

Full employment

The Government said in its December 2013 strategy statement that "full employment (defined as an unemployment rate of approximately 5 to 6%) by 2020, and at a rate of  6%, the International Labour Organisation (ILO) standard, the number of unemployed people would be at 134,000. Adding 76,000 in Live Register activation schemes would give a total of 210,000 or 10% of the workforce total.

The official unemployment rate was at 4.1% at end 2006 and 4.6% at end 2007.

In Q3 2014 there were 124,000 in part-time work seeking full time work and then there is the convenient ignoring of the participation rate - the number in the workforce relative to the total population of over 15 years of age.

The rate was 63.8% in December 2007; 60.2% at end 2010; 59.6% at end 2012 and 60.4% in Q3 2014.

A Central Bank economics paper [pdf] says: "The data indicate that there was a fall of over 104,000 in the total number of males and females aged 15-24 in the labour force between the third quarter of 2008 and the corresponding quarter of 2010."

Emigration and increasing numbers in education are the main factors.

In 2009-2014, net emigration by Irish national was at 124,000.

There are indicators which seek to determine the rate of full employment: NAIRU - Non-accelerating Inflation Rate of Unemployment and NARWU - Non-accelerating wages rate of unemployment.

However because of Ireland's distorted national accounts, the results are not reliable in measuring factors such as the output gap.

Analysis: Irish full-time employee numbers up 14,000 in year; Broad jobless rate at 21%

Irish Economy: Average hourly total labour costs fell 1.9% in four years to Q3 2014

Irish Economy: Bruton says 80,000 jobs added since Q4 2011- 36% are farmers

The idiot/ eejit's guide to distorted Irish national economic data

Facts do not always change minds - can even entrench misinformed

Kenny and Burton also announced plans to launch 10 new strategies - basically wish lists as part of the election campaign:

  • An updated overall macro-economic strategy to grow the economy, deliver full employment and balance the public finances, to be published in the Spring;
  • A medium-term capital plan designed to address emerging economic and social infrastructure bottlenecks that could constrain the recovery;
  • A strategy for financing enhanced economic growth, and for ensuring that credit demand from growing businesses can be supplied;
  • A national enterprise strategy, with a particular focus on ensuring balanced regional development and job creation in areas that have yet to benefit sufficiently from the recovery;
  • A national skills strategy aimed at addressing emerging skills shortages as economic recovery accelerates;
  • A national aviation strategy aimed at further improvements to Ireland's international connectivity for tourism, trade and investment;
  • A strategy to position the International Financial Services Sector for further growth and job creation;
  • An updated labour market activation and welfare reform strategy to ensure that the economic recovery doesn't bypass jobless households.
  • A medium term strategy for early years and school-age care to increase to support increased parental participation in the labour force; and
  • A medium term agri-business strategy to build upon the successes being achieved under Harvest 2020

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