Unemployment rises slightly to 4.2% as wage growth peaks
Jack Kennedy, senior economist at global jobs platform Indeed, analyses the latest CSO data which shows wage growth has eased in Ireland to 3.7% year-on-year in August 2023
5 October 2023
The main unemployment rate rose slightly to 4.2% in September 2023 on a seasonally adjusted basis, up 0.1 percentage points from August, but down from a level of 4.4% 12 months ago, the latest CSO data shows.
The seasonally adjusted number of people unemployed was 115,700 in September and was down by 300 in the past 12 months.
Jack Kennedy, senior economist at global jobs platform Indeed, said the latest figure shows “the labour market remains tight, but there are early signs of a possible softening and an easing of the pressures on recruitment”.
“This will be a welcome development for employers, but less so for employees looking to compensate for the rise in living costs by obtaining higher pay or finding higher paid roles,” Kennedy continued.
“It comes amid signs of a wider slowdown. The latest exchequer figures showed a significant drop in corporation tax while a lower growth rate is predicted in the Irish economy this year due to a fall in exports and lower consumer spending.
“Indeed’s latest data shows wage growth in both Ireland and the EU has peaked. In Ireland, it was down from a year-on-year change of 5.5% in March to 3.7% in August of this year. In the euro area (across the six countries tracked) it dropped from 4.7% year-on-year in March to 4.2% last month.
“In another sign of a softening, the number of Irish job postings on Indeed has reduced, although it remains well above pre-pandemic levels. As of September 29, the number of Irish job postings was down 16% year on year. Job postings remain 27% above their pre-pandemic level, but this is down from a peak of 65% above pre-pandemic levels in February 2022.
“Meanwhile, job postings offering remote and hybrid working remain high and have been consistently up threefold on pre-pandemic levels since February 2021. A total of 14% of job postings included either remote and/or hybrid terms in August of this year. This suggests that even if there is a softening in the labour market, employers may still need to offer some flexibility on in-office days to would-be employees if possible.”