With vaccine rollout approaching completion and large uptake by the Irish public, a gradual lifting of COVID-19 restrictions on businesses and a slow wind up of various wage subsidy and pandemic unemployment programmes, it’s time we turn our attention to life post-pandemic. How do we address some of the longer-term impacts of COVID-19 on Irish society?
One of those impacted areas is the labour market, and in particular those who find themselves out of work as a result of COVID-19, as well as those who were already struggling to find work pre-pandemic and who are now back even further in the queue when it comes to a return to work.
How many people are actually out of work?
What is ordinarily a fairly straightforward question to answer has become more difficult in the past 18 months. New support schemes have been established to address the impact of Government restrictions. These restrictions have resulted in hundreds of thousands of people losing their jobs, or at the very least having their working hours curtailed as businesses respond to reduced demand.
These schemes have included the Temporary Wage Subsidy Scheme (TWSS), Employer Wage Subsidy Scheme (EWSS), and the Pandemic Unemployment Payment (PUP). In addition to all of these, we have the more traditional unemployment support schemes like Jobseeker’s Allowance and Jobseeker’s Benefit. So let’s look at these in distinct groups and understand exactly how many people are currently out of work, and how many more might be at risk of losing their jobs as life returns to normal.
The traditional unemployment schemes
Thankfully we don’t have to do too much background research here. Ireland’s Central Statistics Office (CSO) publishes monthly estimates on the number of people unemployed. During the pandemic they published PUP numbers separate to the more traditional measurement, and so we know how many folks are considered ‘out of work’ as we would traditionally define it. In July 2021, that number stood at 170,800. That’s an increase of 13,300 in the past 12 months, and an increase of 47,800 in the past 24 months.
PUP numbers and student recipients
The next big group of people out of work are those in receipt of the Pandemic Unemployment Payment (PUP), a scheme initially established to support those who lost their jobs as a direct result of Government restrictions. That number has fluctuated wildly over the past 18 months depending on the severity of restrictions in place at the time, but as of early August the number of people in receipt of the PUP stood at 163,327.
However, over time the eligibility criteria for the PUP has changed. Not everybody in that group would be considered unemployed under the traditional definition used by the CSO. A decision was made last year to allow students in full-time education to apply for the PUP if their part-time job(s) had been impacted by the pandemic. Ordinarily, anybody in full-time education would not be eligible for unemployment benefits.
The latest estimates state that roughly 8.1% of all PUP recipients are in full-time education. For PUP recipients under the age of 25, that number is 34.6%, while for those over 25 that figure drops to 1.4%. What does all this mean? Of the 163,327 people currently receiving the PUP, 12,914 are actually full-time students. That leaves 150,413 out of work that would likely meet our traditional definition of unemployment.
Jobs at risk as society reopens
The last group we’ll look at are those impacted by the Employment Wage Subsidy Scheme (EWSS), formerly known as the Temporary Wage Subsidy Scheme (TWSS). These people are technically still in work and so cannot be considered unemployed, but they are employees of businesses whose income has been severely hurt by the pandemic - resulting in at least a 30% reduction in turnover or customer orders.
Numbers related to the EWSS are not updated as regularly by the CSO, with the most recent figures released on the 30th May 2021. As of that date, 287,626 workers (see graph below) were being directly supported by this scheme - meaning all of those individuals were employed by businesses whose turnover has dropped by at least a third.
As society slowly starts to return to normal, we can expect some of those jobs to be lost. In the UK for example, the redundancy rate in Q1 2021 was 5.5 per 1,000 employees. That number was 3.3 per 1,000 employees during the same period in 2019.
Where we currently stand
Taking all of this together, what can we say about the current state of unemployment in Ireland? First, we have 170,800 people who are unemployed under traditional support schemes, with another 150,413 people currently in receipt of the PUP that would meet that same definition. That amounts to a total of 321,213 people currently out of work in Ireland. That’s the highest number we’ve seen since June of 2013 (excluding other periods during the pandemic).
Second, we have more than a quarter of a million people whose jobs and wages are currently being supported by the state due to severe reductions in business activity associated with the pandemic. That’s a lot of jobs at risk, and it’s not hard to imagine that some of those jobs won’t exist come the end of year.
All of this means two things for Government; figuring out how to save as many jobs currently at risk as possible, and trying to ensure that those out of work due to COVID-19 don’t remain out of work for too long. The Pathways to Work strategy announced last month is their first attempt to properly address this crisis, and will no doubt become an increasingly important strand of this Government’s work programme over the coming months and years.
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