Irish unemployment rate falls to 11.0% in October
The latest Live Register release from the CSO shows that the standardised unemployment rate improved to 11.0% in October, down 10bps m/m and 120bps in the year to date.
The standardised unemployment rate has fallen in every month since the start of 2014, while the seasonally adjusted number of people on the Register (371,400 in October) has fallen in each of the past 28 months (-3,500 m/m in October).
The main driver of the improving trend in the unemployment rate is the continued growth in the numbers at work, with total employment having increased in each of the past seven quarters for which we have data (to end-Q2). However, it is not the only factor behind the move in the unemployment rate. The ratio of over-25 year olds to under-25 year olds on the Register widened to 6.03:1 last month, which compares to 5.92:1 in the previous month and 5.36:1 in October 2013. This suggests that emigration remains a very real phenomenon for many of Ireland’s young people in particular. Elsewhere, previously released participation rate data suggest that many people are electing to remain in education or other training courses rather than attempting to seek employment.
The release also shows that long-term unemployment remains a serious problem in Ireland. In October there were 170,892 people unemployed for one year or more, which equates to 47.7% of all those out of work (versus 46.0% in October 2013). While the number of long-term unemployed people has fallen by 6.3% (-11,509) over the past year, the pace of reduction remains disappointingly slow.
In this regard, Investec noted that today’s release also provides details on the number of people enrolled on Activation Programmes, which are primarily aimed at helping the long-term unemployed return to work. There were 75,588 people availing of these programmes in September 2014, which is a decrease of 362 (-0.5%) from the previous year. Persons on Activation Programmes are not counted as part of the Live Register.
All in all, the October Live Register data show that the improving trend in the headline unemployment rate remains intact, helped by the recovery in employment (note that the employment components of the Investec Manufacturing and Services PMIs have persistently been above the 50 mark separating growth from contraction for 17 and 26 months respectively), but the benefits of this have yet to be felt across all parts of the labour force. Philip O’Sullivan, Investec, Philip.OSullivan@investec.ie http://www.investec.ie