Thursday, May 30, 2013

30/5/2013: Official Broader Unemployment in Ireland stands at 25%


The latest data for Q1 2013 from QNHS is out today with worrying sub-trends indicating that the labour markets are not showing any significant improvements in broader metrics of unemployment.

CSO defines 4 measures of broader unemployment:
PLS1 indicator is unemployed persons plus discouraged workers as a percentage of the Labour Force plus discouraged workers.
PLS2 indicator is unemployed persons plus Potential Additional Labour Force as a percentage of the Labour Force plus Potential Additional Labour Force
PLS3 indicator is unemployed persons plus Potential Additional Labour Force plus others who want a job, who are not available and not seeking for reasons other than being in education or training as a percentage of the Labour Force plus Potential Additional Labour Force plus others who want a job, who are not available and not seeking for reasons other than being in education or training.
PLS4 indicator is unemployed persons plus Potential Additional Labour Force plus others who want a job, who are not available and not seeking for reasons other than being in education or training plus part-time underemployed persons as a percentage of the Labour Force plus Potential Additional Labour Force plus others who want a job, who are not available and not seeking for reasons other than being in education or training.

Since all exclude training, we can add those on State programmes into PLS4 to arrive at PLS4+STP - the broadest measure of unemployment.

Here is a chart:



Year on year through Q1 2013:

  • Standard unemployment (PLS1) declined 1.4% from 16.0% in Q1 2012 to 14.6% in Q1 2013. This is good news, made even better by realising that Q1 2013 reading stood at the lowest level since Q1 2010 when it was 14.2%.
  • Adding potential additional labour force to the PLS1 we have PLS2 measure, which in Q1 2013 was 16.0%, down 1% o n Q1 2012 and marking the lowest reading since Q1 2010 when it was registering 15.1%.
  • PLS3 is the above unemployment plus others who want a job, not available & not seeking for reasons other than being in education or training. This measure stood at 18.0 in Q1 2013, down on 18.8% in Q1 2012 (-0.8% y/y) and bang-on identical to the levels in Q1 2011.
  • Last official measure reported by CSO, PLS4 combines PLS3 and those who are underemployed (in part-time employment, but are seeking full-time employment). PLS4 in Q1 2013 was 25.0% - identical to Q1 2012 and up on Q1 2011 when it stood at 23.7%. Thus, once underemployed are added into the equation, Irish unemployment stood still over the last 12 months. This is not great by any means.
  • Finally, I compute PLS4+ State Training Programmes participants by combining QNHS data with Live Register. In Q1 2013, PLS4+STP measure stood at 29.0%, up 0.7% on Q1 2012 and marking the highest historical point for any quarter on the record (previous record was recoded at 28.991% in Q3 2012, which compares against Q1 2013 level of 28.994%).


Chart 2 shows Q1 2013 measures relative to their historical peaks.



Overall labour force participation rate fell again, this time -0.44% y/y and labour force is now down 162,600 on peak.


Notice: the above numbers do not account for emigration and the above unemployment numbers do not account for those who are of labour force participation age, but are not seeking employment and are no longer registering as being a part of labour force. If gross emigration in 2008-2012 stood around 300,000, and assuming that all of it related to families, taking average participation rate at current 59.5% and applying average size of household to the above emigration numbers implies ca 90,000 emigration for those who otherwise could have been in the labour force. With this number factored in the above numbers change as follows:

  • PLS1 standard unemployment would rise from 312,075 to 401,325 or in percentage terms, from 14.6% to 18.0%
  • PLS2 standard unemployment, plus potential additional labour force numbers would rise from 342,000 to 431,250 or in percentage terms, from 16% to 19.4%
  • PLS3 = PLS2, plus others who want a job, not available & not seeking for reasons other than being in education or training would rise from 384,750 to 474,000 or in percentage terms, from 18% to 21.3%
  • PLS4 combines PLS3 and those who are underemployed (in part-time employment, but are seeking full-time employment) would rise from 534,375 (or 25.0%) to 623,625 (or 18.0%)
  • PLS4 + STP would rise from 619,744 (or 29.0%) to 708,994 (or 31.8%)
With some serious caution we can say that approximately over 700,000 people in this country are now either unemployed, underemployed, on State Training Programmes or have been forced to emigrate by the realities of this crisis. We can also say, with much more clarity, that - per official figures - broad unemployment and underemployment in this country is running at its highest level ever, or 29%. recorded.

Post a Comment