ESRI: 18% to be out of work by early sum­mer

Irish Examiner - - Front Page - Ea­mon Quinn

Unem­ploy­ment is likely to surge to more than 18% by early sum­mer as the econ­omy hur­tles into re­ces­sion. Em­ploy­ment could take more than a year to get back to its pre-cri­sis lev­els de­pend­ing on the suc­cess of mea­sures to rein in the Covid-19 pandemic here and glob­ally, ac­cord­ing to an as­sess­ment from the ESRI think-tank.

The ESRI warns that the econ­omy is fac­ing a shock that could, in some parts, ri­val the fall­out ex­pe­ri­enced from the on­set of the bank­ing and prop­erty crash in 2008, in terms of the speed of the job losses and the sud­den­ness of the strain it puts on the pub­lic fi­nances, as Gov­ern­ment ex­pen­di­ture soars and its tax revenues plum­met.

It comes as econ­o­mists at S&P Global Rat­ings and other an­a­lysts pre­dict that the Bri­tish and eu­ro­zone economies are head­ing into re­ces­sion too. Here, the job losses over a “very short pe­riod” hit work­ers in the whole­sale and re­tail trades, and ac­com­mo­da­tion and food ser­vices, which to­gether em­ployed 480,000 peo­ple only a few weeks ago, says the ESRI.

“This speed of change in the for­tunes of the do­mes­tic and in­ter­na­tional labour mar­kets is un­prece­dented,” ac­cord­ing to re­search pro­fes­sor, Kieran McQuinn, and se­nior re­search of­fi­cer, Conor O’Toole, the ESRI re­port co-au­thors.

“The likely in­crease in Ir­ish unem­ploy­ment will be sub­stan­tial in size and rapid in na­ture”, surg­ing to 18% by early sum­mer be­fore fall­ing to 11% late this year, amid a deep re­ces­sion as GDP contracts by over 7%, the re­port says.

The speed of any re­cov­ery here will likely de­pend on the suc­cess of pandemic con­trol mea­sures else­where be­cause, “while the do­mes­tic au­thor­i­ties may be suc­cess­ful in lim­it­ing the spread of the virus, the per­for­mance of the re­cov­ery of the Ir­ish econ­omy will now also de­pend on the ef­fec­tive­ness with which other coun­tries deal with Covid-19”, the ESRI warns. And the ESRI sees the cri­sis putting the pub­lic fi­nances un­der great strain: The 2020 bud­get slumps into a deficit of €12.7bn, equiv­a­lent to a deficit of 4.3% of GDP.

Busi­ness: 16

Newspapers in English

Newspapers from Ireland

© PressReader. All rights reserved.