Unemployment Continues Downward Trajectory Amid Cautious Optimism – Indeed

The main unemployment rate was 4.3% in February on a seasonally adjusted basis, down from 4.4% in January and down from a level of 4.6% twelve months ago. The seasonally adjusted number of people unemployed was 116,500 in February, and fell by 5,700 in the past 12 months.

Jack Kennedy, economist at global job site Indeed, comments on the latest CSO data:

The rate of unemployment fell slightly in February continuing the trend of sustained reduction in joblessness over the past year. It comes amid optimistic, albeit still cautious, forecasts for the Irish economy based on falling energy prices, resilient global demand and easing inflationary momentum.

The recently published Q4 Labour Force Survey from the CSO tells a story of sustained employment growth for the country with 68,600 more people employed in Ireland compared with a year ago. The total number of 2,574,500 was the highest in the State since the series began in 1998 while the unemployment rate among those aged 15-24 years was 9.1%, down from 10.2% in Q4 2021.

The economic sectors that saw the largest growth in Q4 2022 were administrative and support service activities, transportation and storage, accommodation and food and human health and social work.

Today’s CSO figures show the employment trends remain positive and it comes amid a series of optimistic predictions for the Irish economy. The European Commission recently revised its expectation for the performance of the Irish economy in 2023 upwards from 3.2% to to 4.9% with growth of 4.1% for 2024 compared to an earlier forecast of 3.1%.

In doing so, it noted that the Irish labour market continues to perform ‘very well’. It said high household savings would underpin further consumption growth and expected foreign investment in the first half of this year to be strong.

Meanwhile, the Commission expects inflation in the Irish economy to moderate to 4.4% this year compared to an average of 8.1% last year. This is in line with the government’s prediction of inflation reducing to between 4 to 5% this year mainly due to falling energy prices.

Such predictions were influenced by uncertainties around the Northern Ireland Protocol, which could now be reduced if the terms of the Windsor Framework deal are accepted and implemented.

In the meantime, we can expect the Irish labour market to remain tight with employment continuing to grow. Indeed’s data continues to show employers actively hiring, with the level of Irish job postings on Indeed up 59.5% on 24 February 2023 compared to 1 February 2020 (fig 1).