Every three minutes…
Laura Slattery
Every three minutes, another person loses a job, says Fine Gael’s Leo Varadkar today in response to ominous new figures from the CSO. Has Bono been clicking his fingers again?
The Irish Times has checked the maths and found that the FG spokesman on employment speaks the truth – well, kind of. Technically, every three minutes someone signs on i.e. joins the (seasonally adjusted) live register of jobseekers’ claimants (which means that some of them may be part-time or casual workers). But then that doesn’t look quite so catchy on the press release.
But there are other curious numbers in economists’ analysis of the live register gloom. It is estimated that it costs the economy €11 million a year in increased welfare payments and lost tax revenue for every 1,000 people on the live register, notes economist Alan McQuaid. On that basis, the seasonally unadjusted addition of 11,800 people to the dole queue last month alone will cost the exchequer almost €130 million.
If, for no particular good purpose, we combine Varadkar’s “one every three minutes” rule and the lost jobs cost estimates, the economy will have seen another €11 million disappear into a black hole by Friday evening.
And in 12.7 years, the entire workforce will have been handed their P45s…
8:59 am
The average social welfare payment for those “signing on” is approx. €11k per annum. If someone “signs on” having lost their job, the cost to the country is more than €11k per head. Unemployed people will not pay income taxes and will pay a marginally less amount of indirect tax (staples are generally VAT free). The effective tax rate of someone earning the average wage of about €35k is approx. 15%. Their net income would provide an additional 5-10% of their salary in VAT and excise. So the real cost to the country is nearer to €20k per person “signing on”. That’s nearly twice as much as your original estimate.
It’s time to chop Bono’s fingers off.
Comment by Paul