Jobs market puts in strong performance

The jobs market continues to perform strongly, despite the economic slowdown, with figures showing total employment rose by 28,400 in the year to April. Job gains in the public sector, construction and in hotels and restaurants more than offset losses elsewhere.

The increase in employment continued into the second quarter, with a 6,300 rise from the previous quarter to 1.778 million in employment in the March-May period. The figures are contained in the Quarterly National Household Survey, published yesterday by the Central Statistics Office (CSO).

The figures also show a surprisingly stable unemployment trend, with almost no change in the second quarter compared to the previous three months in the seasonally adjusted trend. This brings the total annual rise in unemployment, as measured by the survey, to 4,200 - significantly fewer than the 10,000 average annual rise in the live register in the same period last year.

The survey shows unemployment at 81,400 - well below the 185,00 measured by the live register. The register is always higher as it measures benefit claimants and the CSO warns that it is not designed to measure unemployment. However, the household survey unemployment total would have been expected to rise more sharply. Instead, it shows the unemployment rate holding steady at 4.6 per cent.

Long-term unemployment rose from 1.2 per cent to 1.4 per cent, however, with 26,990 people estimated to fall into this category.

A rise in part-time employment - part of it among students - is one reason for increasing job numbers, the survey shows. Part-time employment rose by 12,400 to 302,000 over the past year, accounting for more than 40 per cent of total employment growth.

This is one sign of the economic slowdown affecting the jobs market, as is the decline in the average working week to 37.2 hours from 37.7 hours a year ago.

However, the performance of the jobs market is still better than might have been expected given the global economy.

Rising public sector employment, particularly in health, accounted for about 17,200 of the annual increase. But the cap imposed on public sector numbers in the Budget is having an impact, with a slowdown in public sector jobs growth in the second quarter.

However, there was a 10,500 annual growth in employment in hotels and restaurants, of which almost 60 per cent was part-time work. An extra 9,300 were employed in construction, as the sector benefited from strong demand for new houses.

The decline in agriculture, forestry and fishing continued with 7,500 jobs shed in the year, while employment in the financial sector fell by 2,200.

Significantly, there was only an 800 drop in manufacturing, which has lost significant numbers in recent years.

The figures show that employment in the past year increased by 2.8 per cent in the Border, midland and west region, outstripping the 1.3 per cent in the east and south.

Mr Austin Hughes, economist at IIB Bank, said the figures painted a fairly encouraging picture of the economy. Even though the jobs market could soften in the third quarter, he said employment this year could still be 10,000 on average ahead of 2002.

However, a statement from the Small Firms Association warned that many small companies were being forced to cut costs and "there will be an erosion of jobs in the second half of 2003 and 2004".