Unemployment Falling- Can It Really Be This Good?


Unemployment falling to 13.7 percent.   Employment increasing by 20,000.  THe CSO’s new Quarterly National Houshould Survey should be good news.  So why isn’t it?  When we dig a little under the numbers, what do the numbers tell us about the kind of economy that is emerging?  Why should we be concerned?

First, let’s run the headline numbers.

On the face of it, these are positive numbers:  employment up by 20,000 over last year – returning to the level of employment in 2011 while unemployment has fallen by well over 1 percent.  But now, let’s look at some numbers below this headline.

(a) The Rise of the Precarious Work

Probably the most disturbing aspect of the CSO release is the rise in precarious work.  This can be seen in the rise in under-employment.

The economy is still shedding full-time jobs.  In the last year, the numbers working full-time fell by 6,000.  The difference was largely made up by an increase of 17,000 in precarious work (a 12 percent increase) – people working part-time but wanting more work.

Some might argue that when the economy is on the floor, the first work available will be part-time and that this will turn into full-time work once recovery sets in.  Let’s hope so but there are grounds for questioning whether this is part of a normal post-recession pattern or a more qualitative change in the nature of work.

Precarious work is part of an employer strategy to minimise costs.  Courtesy of the Government’s policy to cut employers’ PRSI on low-paid work, employers are offering part-time jobs to cut their PRSI bill.  They may have full-time work available but they are breaking them up.  This ultimately costs the State through part-time unemployment supplement, lost tax revenue, higher Family Income Supplement costs.  But it also costs employees:  over one million people suffer multiple deprivation experiences in the state.  Of this, approximately half live in households where there is at least one income from work.  No doubt, this is concentrated in the low-paid precarious sectors.

It is also a policy to discipline employees.  If you are depending on getting extra hours you don’t want to go around trying to organise your work-mates into a union, or complaining about working conditions, etc.  The employee must keep quiet, suffer anything the employer throws at them, all in the hope that they will more hours on the next roster assignment.  The Government could end this by implementing  the EU Directive on Part-time work – which would give part-time employees the right to any extra hours in a firm when it becomes available – but so far they haven’t indicated any willingness to do so.

So there is a very real possibility that we may be entering into a period where precarious work becomes the norm and not just a feature of a weak labour market.

(b) The Weakness of the Market Employment

Over the last year agricultural, fishing and forestry employment increased by 16,000.  This is a good performance for this sector.  But are we getting a true picture?  The CSO has recently starting re-adjusting their samples to align them with the 2011 census.  This will be phased in over the year.  In the meantime they provide a caution about interpreting trends in this sector.  In the survey for the last quarter they state:

‘In the case of the Agriculture, forestry and fishing sector it can be noted that estimates of employment in this sector have shown to be sensitive to sample changes over time. Given the introduction of the sample based on the 2011Census of Population . . . particular caution is warranted in the interpretation of the trend in this sector at this time.’

So we have to be careful about this 16,000 job improvement.  We may find that previous estimates of employment in this sector in the past were under-stated and, so, the total level of employment in the economy.

So how can we look at this.  The following breaks down employment in three sectors: agricultural/fishing/forestry, the market economy and the non-market economy.  The non-market economy includes public administration, education, health and other sectors (recreation leisure) – these are dominated by public sector employment.

Nearly 2,000 jobs were lost in the market economy, an improvement on the 2011-2012 figure which showed a loss of 8,000.  We have, though, still to bottom out in this sector which employs 63 percent of the labour force and is the driver of value-added and exports.

Just to note, the increase in non-market employment is not related to the public sector which has been losing jobs.  There was, however, an increase of 8,000 in the health & social work sector – driven by the private sector.

(c) Increase Due to Rise in Self-Employed

The employment rise in the last year has been almost entirely due to an increase in self-employment.

As seen, while employment rose by 20,000 in the last year, this was due to the rise in self-employment – which made up 16,000 (there was another small increase in assisting relatives of 2,700).

Of course, this increase in self-employment is to be welcomed (better than a decline).  But the question here is how long-term this work will be and to what extent the numbers have been impacted by the CSO’s sampling adjustments.  Many, believing they won’t find work, will try their hand at own-work.  This can be tenuous and low-income with an eventual high-failure rate.  One insight is that the number of self-employed who, in turn employ people, actually fell over the last year by over 3,000.  This was made up by a bigger increase in the numbers of self-employed without employees.

Meanwhile, PAYE employment has stagnated over last year – recording an increase of only 4,000; still, better than a decline.  However, when we strip out the numbers on Government schemes (Community Employment, Jobsbridge, etc.) the number of non-scheme employment rose by only increased by 1,700.

* * *

So what do we have?  We have some good headline news but much of this melts away when examining the details.

Full-time employment is still falling

Employment in the market economy is falling

Precarious work is on the increase – substantially so

The number of employees remains much the same as last year – especially when those on Government schemes are taken into account.

The main growth has been in the self-employed sector – but not in that part of the sector which employs people; that’s still falling

Some of the increase might be due to statistical factors unrelated to what is actually happening the economy.

Then there’s the question of emigration.  With the labour force actually falling by over 9,000 (despite new entrants from education), much of the decline in the unemployed numbers will no doubt be due to people searching for work elsewhere.

This is not a good news story.  At best, it’s mixed.  And to the extent that it presages permanent changes in the labour market – namely, the rise in precarious employment – it is depressing.

via Irish Left Review | Can It Really Be This Good?.

Advertisements

About Old Boy

Love the past and the future but live in the present

Posted on June 3, 2013, in buisiness, EU, Government, Ireland, politics and tagged , , , , , , , , , , , . Bookmark the permalink. 2 Comments.

  1. It’s a similar situation in the U.S. The “official” unemployment rate is slowly falling, but the numbers of long-term unemployed – those who have dropped off the employment rolls – are rising. There is a huge disconnect between the national political debate and what everyday people are experiencing.

    The U.S. Federal Reserve’s monetary policies are globally important. Since 2008, their “quantitative easing” strategy (QE) has kept interest rates low – allowing stock and housing prices to rebound. It is a top-down approach in lieu of a more direct, but politically difficult fiscal stimulus plan (anti-austerity). The problem with this half-solution is that the world economy is now even more vulnerable to bad behavior by the big banks. And, the U.S. regulations (Dodd-Frank) which should be preventing another financial crisis are being assaulted by Wall Street lobbyists.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

sorryless

great vengeance and furious anger served piping hot!

let me photograph you softly

photographs on the street

| SCRIPTEUM |

Blog de escritura

Sally.CS

"Érase una vez una gitana, que escribía historias de amor"

territori del '900

identità luoghi scritture del '900 toscano

fountain hues

the journey of a poetry

Flavorful Delights

A collection of recipes, food inspirations, and finding joy in cooking

Cafė com filosofia

A verdade existe!

From 1 Blogger 2 Another

Sharing Great Blog Posts

A Better Man

Make a Start

johncoyote

Poetry, story and real life.

passaporte no bolso

blogue de viagens

Art Bacchant

drunk on the arts

optimisticlifeat30

The essence of Poetry

Fun Freedom Fables

Stay happy, think positive & live life to the fullest

The Rolling Paper Company

Rolling papers for customized cigarettes has developed from rolling tobacco and weed in dried leaves of trees to rolling them in a paper.

andycritiques

Film & Television Reviews From The Perspective Of A Film & Televison Lover

Truth Troubles

Why people hate the truths of the world.

The Culture Tome

An Online Journal For Appreciating The Past

The Comic Vault

Unlock your inner geek and step inside!

sandsoftime10

A peep into Megha's mind

Education Motivation Inspiration

Warm welcome! This is more than an exploration. Discovery of new ideas and new ways of being.

EXPLORING FOR KNOWLEDGE.

REASONING IS THE FOUNDATION.

Perfect-Style-Knower

Visual Perception- Hot Edgy Erotica Site

THE BOOKS THAT TIME FORGOT.

Reviewing books that time has passed by.

Peach6972's Re🤗Blog🥀

lonly n depress😢🐘make my day 🌷⚘

outofwak (artworldwar)

we are all empty circles, through which the creative power of the universe passes through, whether we like it or not..

Why'd Multiple Sclerosis pick me

My Life with Multiple SCLEROSIS

Windows on Worlds

Because you speak to me in words and I look at you with feelings

Crackdown Review

A place to search something like movie, anime, novel, manga, etc. reviews

Dave's Corner of the Universe

Where strange fact and stranger fiction collide

Trust and Believe in the Unseen

Live with Light of Faith

#FILMose

Crítica para quem gosta de Cinema.

Gaston Bessette, Photographie

La passion de la photo-Photographs as a passion

hands in the garden

short poems for short attention spans

Empowered

Everyday

Iain Kelly

Fiction Writing

The Müscleheaded Blog

"Nothing Exceeds Like Superfluous Jejunity "

After the Final Curtain

"People buy tickets to theatres, not movies." -- Marcus Loew

cracked rear viewer

Fresh takes on retro pop culture

indiescifi451.wordpress.com/

science fiction autopsy. movie reviews, books, quotes, posters. no trash. no bullshit.

%d bloggers like this: