Numbers on Live Register up by 3,330

THE NUMBER of people claiming unemployment benefits rose by 3,300 in December, the largest increase since August, according to Live Register data.

Unemployment remains at a 14-year high, data from the Central Statistics Office (CSO) shows.

The Live Register of Jobseeker’s Benefit claimants stood at 426,700 on a seasonally adjusted basis last month, up 133,700 on the previous December. Estimated unemployment for December remained at 12.5 per cent, the same as in October and November. However, it is the contraction of the labour force – partly as a result of migration – that is curbing further increases.

The number of people under the age of 25 on the Live Register increased by 1,036 in December. There were 22,400 more people in this age category on the Live Register at the end of the year than there was at the start of 2009.

Youth Work Ireland said the latest rise in youth unemployment illustrated that the Government’s strategy in cutting welfare payments to young people, introduced in December’s budget, was flawed. “This increase is a major challenge to the Government view that cutting welfare for young people has had any major effect on their labour market choices,” said Youth Work Ireland’s Michael McLoughlin.

Labour Party leader Eamon Gilmore said the increase in the Live Register “cast serious doubt on claims by Brian Cowen and other senior Ministers that the recession has bottomed out”. Mr Gilmore said there were “potentially huge social consequences” arising from long-term unemployment. “We know the damage done to families and communities by long-term unemployment during the 1980s and, if we want to avoid a repeat of this phenomenon, urgent action is now required.”

The number of company closures during December means dole queues are likely to lengthen further, Mr Gilmore added.

Fine Gael employment spokesman Leo Varadkar said the economy had not turned the corner and would not do so until unemployment begins to fall. “The Government has become obsessed with balancing the books and the banks, and has done nothing about the collapse of the real economy and the ongoing haemorrhage of jobs,” Mr Varadkar said.

Sally Anne Kinahan, assistant general secretary of the Irish Congress of Trade Unions (Ictu), said the Government’s strategy of public-sector pay cuts would “simply take more money out of the economy and ensure that more jobs are lost”.

Unemployment is what is known as a lagging indicator. Rises and falls in the number of people out of work tend not to occur until several months after the economy changes course.

Economists noted that the rate of increase in Live Register claimants continued to slow last month, but added that outward migration was responsible for the stable unemployment rate rather than a better jobs market.

Unemployment is expected to rise over the coming months, but many economists now expect the rate to peak below 14 per cent – lower than previously forecast.