The number of people signing on the live register rose to its highest level in nearly a year last month. Marc Coleman, Economics Editor, reports.

The seasonally adjusted figures showed a monthly rise of 1,600, bringing the total number signing on to 159,800, a level not seen since last June, according to data released yesterday by the Central Statistics Office (CSO).

The figure is 1,400 higher than in May 2006. Unadjusted figures show the annual increase was 1,450, although they also record a decline of 309 in the numbers registering in April.

The latest figures coincide with indications that the jobs market is slowing down. Computer giant Dell, which employs 4,500 people in Ireland, yesterday announced it was shedding 10 per cent of its global workforce.

Separately, NCB's monthly purchasing managers index on the health of the manufacturing sector yesterday indicated rising pessimism about employment in that sector.

May saw the sharpest decline in the outlook for manufacturing employment since July 2003, according to the survey.

A study published yesterday by AIB also predicts that employment growth in the economy is set to slow as the rate of house building declines.

Rossa White of Davy Stockbrokers said yesterday's live register numbers could reflect a turning point in the construction sector. "The May reading is the first tentative sign of housing spillover into the rest of the economy."

However, he added that he did not expect major deterioration in the labour market until late 2007 or early 2008.

Bloxham Stockbrokers economist Alan McQuaid said labour market trends remained positive. "The Irish economy remains strong and we will see another very positive rise in net employment this year, though maybe not as much as in the past couple of years," he said yesterday.

Ciarán Lynch, the newly elected Labour TD for Cork South Central, said the latest employment trends called for a proactive stance from the Government on jobs.

"Ireland has lost much of its competitive advantage through the failure of Fianna Fáil and the PDs to deliver in such areas as infrastructure and broadband and to control utility costs," Mr Lynch said. "These issues must be a priority for the incoming government."

The live register does not measure unemployment as it includes part-time, seasonal and casual workers, but according to the CSO, its latest trend implies that unemployment rose to 4.5 per cent in May, compared with 4.4 per cent in April.