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Boost for government as Irish unemployment dips below 9 percent

Published 17/11/2015, 12:20
© Reuters.  Boost for government as Irish unemployment dips below 9 percent

By Padraic Halpin

DUBLIN (Reuters) - Ireland's unemployment rate fell below 9 percent for the first time since 2008 after the figures for October were revised sharply downwards on Tuesday, a boost for the government ahead of elections early next year.

With Ireland's economy set to grow by more than 6 percent this year and forecast to be the fastest growing in Europe for a third successive year in 2016, Ireland's coalition government is putting the recovery at the centre of its re-election campaign.

The jobless rate, which hit a high of 15.1 percent in early 2012 when Ireland was midway through a three-year international bailout, fell to 8.9 percent last month and not the 9.3 percent previously estimated, the Central Statistics Office said.

"Today's news is an important milestone which gives us confidence that the plan is working," Ireland's jobs minister Richard Bruton said in a statement.

"However there are still many people around the country who are not feeling the benefits yet, and there is still a long way to go before we can say we have replaced all the jobs that were lost and attract young emigrants home in large numbers."

Prime Minister Enda Kenny's Fine Gael and coalition partners Labour are banking on voters feeling the effects of the recovery and two years of tax cuts by the time elections are held, probably in February or March.

With opinion polls showing they are short of the support needed to return to power, the parties need the jobs recovery to broaden across the country.

While unemployment fell fastest in the south west, to 8.4 percent at the end of the third quarter from 9.9 percent three months earlier, the rate is still above 12 percent in the slow recovering south east and midlands regions.

Employment has also increased in 12 of the 14 economic sectors on an annual basis, with the recovery sharpest in the hard-hit construction industry.

"The labour market has improved dramatically over the past couple of years, reflecting the strengthening of the economic recovery," said Alan McQuaid, chief economist at Merrion Stockbrokers.

"A net increase in jobs of close on 53,000 is now forecast for 2015 with another healthy increase of around 50,000 now envisaged for 2016."

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