The axe is set to fall on another 14,000 jobs in Northern Ireland, a top economist has warned.
The number of people tipped to claim unemployment benefit by 2012 is 70,000, which would mean a trebling of the dole queue in less than five years.
It comes as new figures show that unemployment here has soared to 56,100 — up 600 on the previous month and an increase of 6,700 (13.6%) compared to the same period last year.
That means Jobseeker’s Allowance payouts alone are costing the Treasury on average £3.3m a week and could rise to more than £4m a week.
Unemployment in Northern Ireland rose by 1.1% last month despite a fall of 1.4% across the rest of the UK, while economic inactivity also remains the highest of all 12 UK regions.
The statistics from the Department of Enterprise, Trade and Investment also revealed that 40.9% of the unemployed have been jobless for one year or more while the unemployment rate for 18-24 year olds stands at 17.4% — that means that youth unemployment accounts for almost one-fifth of the jobless total.
The north west continues to be the worst affected area with the highest claimant rates in Londonderry (7.4%), Limavady (7%) and Strabane (6.8%).
However, the highest percentage increase in levels over the year to June were Newry & Mourne (27.5%), Castlereagh (22.6%) and Armagh (20.4%).
Ulster Bank’s chief economist Richard Ramsey has warned that more job losses are on the cards because of the lack of employment opportunities.
“Given that the much awaited economic recovery in Northern Ireland has failed to materialise in any meaningful sense, private sector firms will be forced to lay-off more employees. Furthermore, the £1.5bn worth of public expenditure cuts over the next four years are going to lead to thousands of job losses.”
Sectors which will bear the brunt of the ongoing economic challenges are construction, business services and retail.
Enterprise Minister Arlene Foster said: “It is clear that the Northern Ireland economy is likely to face further pressures. The public sector spending cuts, announced by the Chancellor in the Emergency Budget, will no doubt have an impact on the timing and strength of the recovery in Northern Ireland.” However, her comments come just one day after the latest Ulster Bank PMI indicated that Northern Ireland’s private sector is in the doldrums.
The province has not recorded growth since November 2007 while the UK as a whole has notched up its 14th consecutive monthly rise in business activity.
Northern Ireland’s private sector has also declined at its fastest pace in five months, the findings released yesterday show.
The new unemployment figures and PMI come against warnings that the province’s economy is set to decline in 2010 for a third successive year.