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The rate of unemployment measures the percentage of people who are not in work, but who are available for and actively seeking work.
It is generally accepted that zero unemployment is unlikely, even when an economy is operating at full capacity. This is due to various factors such as availability of job information, skills and education and the degree of labour mobility. For this reason, a full rate of employment is generally considered to exist when unemployment is around 4% in an economy.
Note: A range of measures have been introduced by the Government in relation to providing income support for those whose employment has been affected due to the COVID-19 pandemic in Ireland. Those in receipt of the COVID-19 income supports do not meet the criteria to be considered as unemployed for the purposes of the compilation of the results for the standard monthly unemployment estimates published by the CSO.
Therefore the CSO created alternative COVID-19 Adjusted Measure of Unemployment to supplement the standard monthly unemployment measure. Together these measures can be considered as being the upper and lower bound respectively of the true unemployment rate. Data below are from the standard monthly unemployment measures published by the CSO.
Unemployment Rate %
Source: CSO – Labour Force Survey
Long Term Trends
Annual unemployment rate in Ireland in 2019 was 5% compared to 5.8% in 2018 and the peak unemployment rate of 15.5% back in 2012. Data prior to the COVID-19 pandemic showed that there was an annual increase in employment of 2.2% or 51,700 in the year to the first quarter of 2020, bringing total employment to 2,353,500. Employment increased in 10 of the 14 economic sectors over the year as end of first quarter of 2020. The largest rate of increase was recorded in the Information and Communication sector (+8.3% or +9,800).
The latest figures available indicate that the seasonally adjusted unemployment rate for the EU-27 for August 2020 was 7.4% compared to monthly unemployment rate of 7.2% for Ireland during the same period.