The unemployment rate rose marginally in January to 5.3%, up from 5.2% in December, new figures from the Central Statistics Office show today.
When those on the Pandemic Unemployment Payment (PUP) are included, the rate moved up to 7.8% from 7.4% in December.
This compares to a jobless rate of 27.1%, including those on the PUP, recorded in January 2021.
January’s figures are affected by the re-imposition of restrictions on some activities in the events and hospitality sectors for several weeks during the month.
Commenting on today’s figures, Jack Kennedy, economist at global job site Indeed, said the labour market started the year on a negative note with unemployment rising slightly in January, against a backdrop of a very positive macro-economic outlook for the country in 2022.
Jack Kennedy noted that in its most recent update, the Central Bank said it anticipated the economy creating 167,000 jobs over the next two years, which will bring the unemployment rate down to 4.6% by the end of 2024.
The Indeed economist said the recent unlocking of the economy and perceived diminished threat of the omicron variant bodes well for job creation, although this will have had a limited impact on the January data.
“The flipside of the positive pandemic news is that the phasing down of the Pandemic Unemployment Payment (PUP) and Employment Wage Subsidy Scheme (EWSS) supports has returned,” he said.
“This means businesses will have to stand on their own two feet in an environment that for some may be a more challenging landscape than that faced pre-pandemic, particularly in the retail and hospitality sectors,” he added.
Meanwhile, Minister for Finance Paschal Donohoe said he thinks some employers will face challenges as the Employment Wage Subsidy Scheme changes.
Speaking on RTÉ’s News at One, Mr Donohoe said the reason the Government ran the scheme for so long was to give every employer who was viable before the pandemic “every possibility of surviving the aftermath”.
He added that he is confident that the vast majority will.
“The reason we put in place a plan now of moderating and reducing it slowly over time is to give employers every prospect of being viable once the EWSS comes to an end, which for all it will do by the end of May,” he said.