Irish families in 'misery' as unemployment rises and prices soar
Irish families are being squeezed by the worst combination of high unemployment and rising prices in nearly 20 years.
New figures from the Republic's Central Statistics Office show the unemployment rate rose to 14.8pc last month as an extra 2,600 people signed on in May, while the numbers out of work long term have soared by more than 50,000 in the last year.
Davy stockbrokers said their "misery index" -- combining the inflation and unemployment rates -- was at its highest level since 1992, as job losses and income cuts were no longer being cushioned by the falling prices seen up until mid-2010.
"Irish consumers are being buffeted by three headwinds -- the government's tax and spending plans, higher inflation and rising unemployment," said Davy analyst Conall Mac Coille.
Next year consumers stand to be hit even harder when new household tax and water charges come in. The Irish Congress of Trade Unions (ICTU) said the latest rise in unemployment confirmed the failure of the austerity programme and the need for a policy change at EU and national level.
"Deflation is simply not working and is leading directly to job losses. We have seen domestic demand crash by over 25pc in less than three years. That translates into thousands of job losses and thousands of families in very difficult circumstances," ICTU adviser Paul Sweeney said yesterday.
The unadjusted CSO figures show that there were 440,947 people on the Live Register in May -- over 3,000 more than a year ago -- pushing the unemployment rate up from 13.2pc to 14.8pc in a year.
The seasonally adjusted figure of 443,400 is the worst since last December.
The number of short-term claimants has fallen but there has been a huge increase in the numbers out of work for more than a year -- up from 126,065 in May 2010 to 176,334 now.
That means the long-term unemployed now make up 40pc of the total compared to 29pc a year ago.
Irish enterprise minister Richard Bruton said the new CSO figures showed a "business as usual" approach to the economy was not enough.
"That is why my sole focus every day is to deliver on policies that will help get as many people off the dole queues as possible," he said.
"That means making our economy more competitive across the board -- whether in protected sectors like professional services or labour intensive sectors like tourism, retail and construction."
Redundancies also increased last month -- up almost 10pc to 4,117. This was a rise of 350 from the April figure of 3,768, but down 17pc on May 2010.
A total of 2,494 men and 1,623 women took redundancy, with highest number (779) in the construction industry.
The Irish National Organisation of the Unemployed said the latest jobless figures were a strong argument against calls from the OECD to cut social welfare payments to long-term claimants.
"Threatening to cut unemployed people's payments will not get people back to work; it will just make life much harder for an increasing number of people," said spokeswoman Brid O'Brien.
Referring to the figures, Joe Durkan, of the Economic and Social Research Institute (ESRI), said: "Back when it was really bad in the late Eighties and early Nineties, it used to be said lots of people would never work again, but that wasn't the case at all, as when the economy turned and jobs were created, it benefitted everyone."
However, Bloxham analyst Alan McQuaid warned that further job losses looked inevitable in construction, financial services and retail sectors and that unemployment could reach 15pc with little chance of an improvement before the end of the year.