Minister Donohoe notes CSO figures showing initial impact of COVID-19 on Ireland’s labour market

21st May, 2020

  • On a seasonally adjusted basis, the ‘official’ employment level rose in the first quarter by 22,800 to 2.37m, a 1.0 per cent rise relative to the previous quarter.
  • An ‘official’ seasonally adjusted unemployment rate of 5.0 per cent was recorded in the first quarter.
  • COVID-19 layoffs may be officially classified as either unemployed, in employment, or outside the labour force altogether depending on the individual’s circumstances.
  • When pandemic impacts are taken into account, total employment at the end of the first quarter of 2020 stood at 2,070,371, and 1,751,393 at the end of April.
  • An ‘effective’ COVID-19 unemployment rate of approximately 15.5 per cent is estimated for the end of March 2020, and 28.2 per cent for the end of April.
  • Clearer picture of the labour market impact will be seen when data for the second quarter are released.

Labour Force Survey data for the first quarter of this year, published by the Central Statistics Office today (Thursday, 21 May 2020), capture the labour market impact of the pandemic only to a limited extent. This is, in part, because the impact on the labour market did not fully manifest until early-April, and also because of how COVID-19 induced job losses are officially classified under international statistical rules.

When the effects of COVID-19 are accounted for, the level of employment in Ireland at the end of the first quarter of 2020 was 2,070,371 persons. While the official seasonally adjusted unemployment rate for the first quarter is recorded at 5.0 per cent, the ‘effective’ unemployment rate capturing the full impact of COVID-related layoffs is best seen in the monthly figure for March which stood at approximately 15.5 per cent. The full labour market impact of the pandemic will not be seen until the second quarter data are published later in the summer. For example, the effective unemployment rate for April accounting for COVID-related layoffs stood at 28 per cent.

Commenting on the figures, the Minister for Finance and for Public Expenditure and Reform, Paschal Donohoe T.D., said: “Today’s figures confirm that Ireland’s labour market began to feel the negative effects of COVID-19 towards the end of the first quarter of this year. It is clear that the extraordinarily difficult but absolutely necessary measures being taken to save lives and protect public health have had a profound impact on economies and societies all over the world. Ireland is no exception and our labour market is bearing the brunt.”

Minister Donohoe added: “At this point in time, it is clear that conditions deteriorated further in the second quarter.  Thereafter, the situation in the labour market should gradually improve, in line with the recently published Roadmap for Reopening Society and Business, with unemployment steadily falling.  My Department is projecting the unemployment rate to approach 10 per cent by the end of the year, with an average unemployment rate of around 14 per cent across the year as a whole.

“The Government has responded quickly and forcefully to limit the deterioration in the labour market on people’s incomes.  The Pandemic Unemployment Payment and the Temporary Wage Subsidy Scheme have helped to cushion the shock on both employees and employers.  This is how we are bridging the gap between crisis and recovery.”


Note to Editors:

  • The impact of COVID-19 on the labour market may not be fully captured by the official measures of employment and unemployment. It is likely that many persons in receipt of the Pandemic Unemployment Payment (PUP) may not meet the official statistical classification of unemployed as defined by the International Labour Organisation (ILO) and utilised by the CSO. For example, if an individual in receipt of the PUP has not taken specific steps to find work they may be classified as being outside the labour force rather than unemployed, while a worker with a reasonable expectation of returning to work within the next few months may still be defined as being employed.
  • Those being paid through their employer via the Revenue Temporary Wage Subsidy Scheme are most likely to be classified as ‘in employment’ as the lay-off is temporary in nature and they are still in receipt of at least 50 per cent of their wage/salary from their employer (though subsidised by the State).
  • Official total employment in Q1 2020 was 2,352,500, up 51,500 (2.2 per cent) from Q1 2019.
  • Official unemployment totalled 114,400 persons in Q1 2020, unchanged from Q1 2019.
  • The official seasonally adjusted unemployment rate in Q1 2020 was 5.0 per cent, down from 5.1 per cent in Q1 2019 but up from 4.7 per cent in Q4 2019.
  • The ‘effective’ COVID-19 unemployment rate represents the official unemployment rate plus the CSO’s estimate of those in receipt of the Pandemic Unemployment Payment.
  • The latest data from the Department of Employment Affairs and Social Protection show that 584,600 people were in receipt of the PUP as of May 18th, in addition to the 214,700 persons on the Live Register at the end of April.
  • In addition, there are now over 54,000 employers who have registered with the Revenue Commissioners for the Temporary Wage Subsidy Scheme. As of May 18th at least one subsidy has been paid to over 464,000 people under this