Unemployment Blackspots - Committee on Enterprise, Trade and Employment

In discussing Unemployment Blackspots with the Committee on Enterprise, Trade and Employment Social Justice Ireland made the following observations. Ireland’s employment landscape has seen remarkable improvement in recent years, with the unemployment rate standing at 4.6% as of quarter 2 of 2024. This indicates a strong recovery in the job market, which has seen the number of people employed rise to 2.75 million, the highest in the history of the State. While the overall employment data paints a picture of significant progress, the challenges of unemployment, particularly long-term unemployment, and underemployment remain substantial. The reduction in the unemployment rate has not been evenly distributed among demographic groups or regions. 

 

Youth unemployment remains a major labour market policy challenge, given young people are particularly vulnerable to long-term detachment from the workforce. By the end of 2023, almost 34,000 people under the age of 25 were unemployed, meaning youth unemployment accounted for almost three in every ten unemployed people in Ireland. It is crucial for the Government to invest in the youth unemployed, which, again, we consider to be a central and strategic priority.

Another key group disproportionately impacted by long-term unemployment includes disabled persons or those with long-lasting conditions, as highlighted by the census 2022 data. The data revealed that among those who experienced at least one long-lasting condition or difficulty to any extent, there was a labour force participation rate of 40%. This compares with a rate of 61% for the population at large. Among those found to have a long-lasting condition or difficulty to a great extent, the participation rate was 22%. Additionally, six out of ten persons with a disability who were unemployed were out of work long term. For people experiencing a long-lasting condition or difficulty to a great extent, this proportion increased to 72%.

Alongside the challenges of unemployment, figures also point towards the growth of various forms of part-time work and a high number of underemployed workers over recent years. While the number of people employed is higher now than at any time, just over one in five workers are part time. Almost 140,000 of these are underemployed, that is, working part time but for fewer hours than they are willing to work. The high number of individuals with fewer work hours than is ideal, as well as those with persistent uncertainties concerning the number and times of hours required for work, is a major labour market challenge and one that may grow in the period ahead.

While underemployment and precarious work present challenges across Ireland, these issues are particularly pronounced in certain regions, further highlighting the uneven distribution of economic opportunities. Despite Ireland’s overall increase in employment rates, significant regional disparities persist, with lower participation in the Border, mid-west, midlands and south-east. Unsurprisingly, Dublin remains the best performer. It is also interesting to note that the mid-east - essentially, the region that surrounds Dublin - is the only other region where the labour force participation rate is above the national average. This trend is concerning as the national average is artificially dragged up by the Dublin region while much of the rest of the country underperforms by comparison.

These disparities are further reflected in the Pobal deprivation index data, which highlights that “more isolated rural areas situated in the Northwest of Ireland - Donegal and Mayo, as well as parts of Sligo, Cavan, Leitrim, Longford and Roscommon - continue to have higher levels of deprivation than the Southeast”. The index reveals that persistently high levels of disadvantage exist in certain areas, with many disadvantaged regions reporting lower levels of educational attainment and significantly higher levels of unemployment than the national average. These rising disparities were also mirrored in the European Commission’s decision to downgrade the west and north-west to “lagging region” status, reflecting ongoing challenges such as lower disposable incomes, fewer viable farms and less commercial activity, which generates fewer high-value jobs than the other regions.

While there has been a welcome increase in employment nationally in recent years, this has taken longer to spread to the regions and more rural areas. The increase in remote working is a positive move and can revitalise rural economies. However, ongoing challenges, including the development and implementation of an effective rural-proofing model, still have to be addressed. To this end, it is vital that Our Rural Future and Making Remote Work are fully implemented and resourced.

Across Ireland, several key issues contribute to pockets of persistent unemployment and underemployment. While many of these factors are common across both urban and rural areas, rural areas face distinct challenges that compound existing disparities between rural and urban economic opportunities.

Social Justice Ireland made the following policy recommendations: 

• Resource the up-skilling of those who are unemployed and at risk of becoming unemployed through integrating training and labour market programmes.
• Launch a major investment programme focused on prioritising initiatives that strengthen social infrastructure, including a comprehensive school building programme and a much larger social housing programme.
• Adopt policies to address the worrying issue of youth unemployment. In particular, these should include education and literacy initiatives as well as retraining schemes. 
• Establish a new programme targeting those who are very long-term unemployed (i.e. 5+ years).
• Ensure that at all times policy seeks to ensure that new jobs have reasonable pay rates, and adequate resource are provided for the labour inspectorate.
• Adopt policies to address the obstacles facing women when they return to the labour force. These should focus on care initiatives, employment flexibility and the provision of information and training.
• Reduce the impediments faced by people with a disability in achieving employment. In particular, address the current situation in which many face losing their benefits when they take up employment.

In addition, the following policy positions should be adopted to promote balanced rural and regional development:

• Ensure that investment is balanced between the regions, with due regard to sub-regional areas.
• Ensure rural development policy is underpinned by social, economic, and environmental wellbeing.
• Prioritise the continued roll out of high-speed broadband to rural areas.
• Invest in an integrated, accessible, and flexible rural transport network.
• Ensure that sustainable agriculture policy, sustainable land management, and short supply chains for farmers and consumers form the basis of future agricultural policy.
• Ensure that development initiatives resource areas which are further from the major urban areas to ensure they do not fall further behind.
• Invest in human capital through targeted, place-based education and training programmes, especially for older workers and those in vulnerable employment.
• Establish a Just Transition and Adaptation Dialogue to ensure rural areas are not disproportionately impacted by green and digital transitions.
• Prepare for the potential impact of technology on the future of work by investing in the regions and ensuring the necessary social, infrastructural, and human capital supports are in place to manage any upheaval.
• Provide integrated supports for rural entrepreneurs, micro-enterprises, and SMEs.
• Ensure public service delivery in rural areas according to the equivalence principle.

The full debate can be accessed here. 

Social Justice Ireland’s submission to the Committee on Enterprise, Trade and Employment is available here.