Friday, June 26, 2009

why unemployment statistics are artificially high

It's pretty depressing when we hear and read about the soaring unemployment figures in Ireland.

It's prime media fodder. It's doing a lot of harm to the genuine job seeker because if you're already depressed about the thought of seeking work, it's very off-putting when you hear that there's half a million people not working in our small country.

The live register, quoted all over the media, is not designed to measure true unemployment so it's not an accurate barometer of the true climate.That's because it is not a claimant count.

The live register figures include people entitled to claim allowances, that includes part-time, seasonal and casual workers. Even in the boom the actual level of unemployment never went below 150,000!

The main condition for signing on and receiving unemployment benefit/allowance is that you are available for and are genuinely seeking work.

But a lot of people on the live register do not fall into this category.

There's the fraudulent claimants, the long term unemployed, the stay at home mums (ok and dads) who are not looking for work, students who have just finished their school or college and thousands of people who are 'taking the summer off to re-evaluate their options' chill out and forget about looking for a job.

The true level of 'those genuinely seeking work' is hard to gauge.

However, the official measure of unemployment is measured by the Quarterly Household Survey from the Central Statistics Office ( According to this survey the latest available information (1st quarter of 2009) indicates that the unemployment rate was 9.6%.

According to leading economists, the labour force figures (those in work) were 2.1 million in Feb/March 2009 and allowing for seasonally adjusted figures are probably just under 2 million right now. One economist quotes that in the first quarter for 2009 there were approximately 170,700 people unemployed. (Quarter 2 2009 stats available soon from CSO))

That's a far cry from the 500,000 unemployed that some hysterical voices in the media are quoting, isn't it?

It's true that unemployment has climbed sharply, but the live register should not be the source of the true level of unemployment. Neither should it lead you to believe that the amount of people on the live register means 'that there's no jobs out there'.


  1. Good post and it just goes to show that if you don't understand statistics you get duped by the media. I'd be interested to know where you got the statistics from apart from the CSO. Which economists are you referring to?

  2. Thanks peter. You ask where the stats come from. CSO website mainly. Dr Dan McLaughlin in a letter to the Irish Times back in April argued that the actual level of unemployment is derived from the QHS and not the live register. He also quoted the actual figures of unemployment during the boom and the that the true level of employment is 2.1 million for 1st Q 2009. Hope that helps. Caroline