Up to 40,000 furloughed workers here could face unemployment when the Government's job retention scheme expires, it's been claimed.
Around 211,700 people are enrolled on the emergency scheme, which enables companies to keep their workers on the payroll despite a catastrophic drop in business due to Covid-19.
But with the job retention scheme expiring in October, it's expected that large numbers of workers will eventually be made redundant as employers' workload will not be the same as t was pre-Covid-19.
Already, the number of people claiming unemployment benefits has more than doubled since March to reach 65,200. And the number of proposed redundancies hit 1,400 over the first few weeks in June, up from 350 in May.
Senior economist Gareth Hetherington, director of the Ulster University economic policy centre, said it is estimated that 10% to 20% of furloughed workers would ultimately end up unemployed. Some sectors, such as manufacturing, would see 20% of furloughed workers without a job to come back to, and other sectors could have losses of less than 10%.
"Different sectors will recover at different rates, and in some, restrictions will be lifted quite quickly, though for others, restrictions are in place for quite an extended period of time. Anything more than 20% brings us into very, very big numbers, and returns us to a level of unemployment we last saw in the late 1980s or early 1990s," he said.
Rosemary Connolly, an employment law solicitor based in Warrenpoint, said companies needed to tread carefully if they were making people redundant.
"There is of course a very real risk that with the tapering off the furlough scheme that many companies, for whom it has been a form of life support in terms of retaining employees, will have to take difficult decisions about reducing employment numbers and/or reducing core terms and conditions of employment, eg hours of work as they contend with a changed environment," she said.
"Employers will need to take great care to ensure that in negotiating variation of contract terms or indeed implementing a redundancy process that they fully observe consultation requirements with affected employees and that they adopt a fair procedure and use only job related objective criteria in determining which positions should be made redundant."
She said employers need to plan now what their future staff requirements will be before the scheme runs out in October.
The Department for the Economy said it will soon publish a paper which will "look at the risk around furloughing and the potential pathway of unemployment".
Co Tyrone firm Mallaghan Engineering, which makes equipment such as lifts for airports and airlines, this week became the latest big employer to confirm that jobs will be cut due to a fall in demand. Aerospace firms Bombardier and Thompson Aero have announced up to 1,100 job losses between them.
Stephen Kelly, the chief executive of Manufacturing NI, said that with Northern Ireland firms required to give 90 days notice of plans to make more than 100 staff redundant, July and August could become "difficult periods" for the economy.
Firms here were having to make decisions on the size of their workforce more quickly than in Great Britain, where 45 days notice is required.