Published on 

Government notes the significant impact the pandemic has had on people’s livelihoods in Q4 jobs numbers

  • The official seasonally adjusted unemployment rate stood at 6.0 per cent in the fourth quarter last year, up from 4.7 per cent for the same period in 2019.
  • The official level of employment fell by -2.5 per cent (-55,000) year-on-year to 2.3 million persons.
  • The CSO’s COVID-adjusted unemployment rate, counting all PUP recipients as unemployed, was 19.4 per cent at the end of the fourth quarter, and 25 per cent for the end of January 2021.
  • The COVID-adjusted measure of total employment is estimated at 1.97 million at the end of fourth quarter, down 17 per cent year-on-year, and 1.82million in January 2021.
The Central Statistics Office today (Thursday, 25 February 2021) published the Labour Force Survey (LFS) for the fourth quarter of last year, capturing the continuing impact of the pandemic on people’s livelihoods. The LFS showed a rise in the official unemployment rate to 6.0 per cent in the fourth quarter and a further year-on-year fall in total employment.

Although the official unemployment rate rose to 6.0 per cent in the fourth quarter of 2020 from a low of 4.7 per cent in the fourth quarter of 2019, there are still many people that have lost employment as a result of the pandemic who do not meet the International Labour Organisation definition of unemployed. This is evident in the difference between the LFS unemployment rate and the CSO’s COVID-adjusted rate, which counts all recipients of the PUP as unemployed and stood at 19.4 per cent in December before rising again to 25 per cent by the end of January 2021. While 2.3 million people were officially employed in the fourth quarter according to the LFS, when adjusted for PUP recipients the figure would have stood at 1.97 million (some 390,000 lower) at the end of December and 1.83 million in January 2021.

Commenting on the figures, An Tanaiste and Minister for Enterprise, Trade and Employment, Leo Varadkar TD said: ‘Today’s numbers lay bare the devastating impact that the pandemic has had on the economy and employment. More than 400k jobs have been lost and a quarter of the labour force is now unemployed. It also shows the disparity and unfairness of the virus with job losses heavily and disproportionately affecting the private sector and sectors like retail, hospitality, tourism and entertainment especially.’ 

‘Maintaining social solidarity must be paramount and for this reason Government has decided to extend all financial supports for business and workers through to June 30th. This will help to protect incomes, maintain living standards and keep businesses going. When it is safe to re-open our economy ,we should do so, but not before. In doing so, we will need to ensure that we put in place a National Economic Plan to enable a return to full employment no later than 2023.  It must focus on helping businesses and individuals worst affected to get back on their feet; to get businesses back open, people back to work or education and ensure that post-pandemic we have more security for everyone’ 

The Minister for Finance, Paschal Donohoe T.D., said: “The labour market was on the economic front line since the onset of the pandemic. The rise in the LFS unemployment rate to 6.0 per cent in the fourth quarter of last year, and 19.4 per cent at the end of the fourth quarter when all PUP recipients are included, in today’s figures shows the impact of the pandemic on people’s livelihoods. My Department has previously shown that these measures represent a lower and upper bound respectively of the true underlying rate, which lies somewhere around the mid-point of the two”.

Minister Donohoe added: “The latest Level 5 public health restrictions have had a significant and rapid impact on our labour market with numbers of claimants for the PUP rising to peak of 481,000 at the start of February, with more than 1 million persons combined in receipt of income support from the State in the form of the PUP, the EWSS and the Live Register. However, I am encouraged by the fact that, the rise in the number of people relying on the PUP has stayed well below the peak of 600,000 from early May last year, and has fallen in recent weeks to now stand at 473,000. Moreover we are now in a position to start reopening our schools on a phased basis. If we continue our diligent efforts, as we have done to date in reducing the spread of the virus for a third time, many people will return to work once Level 5 restrictions are lifted.”

“The Government remains absolutely determined to support businesses, jobs, incomes and public health. Over the course of this year and last the Government has committed almost €38 billion in Covid related supports, or 19 per cent of GNI*. As recently as this week the PUP, EWSS, enhanced illness benefit and CRSS support schemes were extended to the end of June, while at the same time continuing to provide significant supports, through loans, grants, vouchers, commercial rate waivers and other business support schemes. The Government will soon publish a National Economic Plan setting out a pathway for recovery in the Irish economy over the medium term, with growing and sustaining employment as a top priority.”


Note to Editors:

  • The impact of COVID-19 on the labour market may not be fully captured by the official measures of employment and unemployment. It is likely that many persons in receipt of the Pandemic Unemployment Payment (PUP) may not meet the official statistical classification of unemployed as defined by the International Labour Organisation (ILO) and utilised by the CSO.
  • For example, if an individual in receipt of the PUP has not taken specific steps to find work they may be classified as being outside the labour force rather than unemployed, while a worker with a reasonable expectation of returning to work within the next three months may still be defined as being employed rather than unemployed. According to the CSO just under 63 per cent of PUP recipients were officially classified as employed in the fourth quarter, with 12 per cent classified as unemployed and 25 per cent classified as inactive.
  • Those being paid through their employer via the Revenue Temporary Wage Subsidy Scheme (now the Employment Wage Subsidy Scheme) are most likely to be classified as ‘in employment’ if any lay-off is temporary in nature or if they are still in receipt of at least 50 per cent of their wage/salary from their employer (even if subsidised by the State).
  • The COVID-19 adjusted unemployment rate represents the official unemployment rate plus the CSO’s estimate of those in receipt of the Pandemic Unemployment Payment. This rate should be treated as an upper bound for the true unemployment rate.
  • As noted by the CSO, roughly 33 per cent of PUP recipients under the age of 25 are full-time students. Full-time students would not normally be eligible for jobseekers payments, nor would they be classified as unemployed. However they are included in the COVID-19 adjusted measure of unemployment.
  • For this reason, the change in hours worked represents a reasonable proxy for the impact of the pandemic on the labour market.
  • Similarly, the COVID-19 adjusted measure of employment should be treated as a lower bound for the level of total employment.
  • These issues are addressed in detail in Economic Insights a recent Department of Finance publication on economic statistics during Covid-19.
  • The latest data from the Department of Social Protection show that 473,000 people were in receipt of the PUP as of February 22nd, in addition to just over 188,500 persons on the Live Register for the month of January.
  • In addition, Revenue report that there were an estimated 351,300 employees supported by the Employment Wage Subsidy Scheme in January.
  • Total COVID related supports in 2020 and 2021 are detailed in the Department of Finance ‘Taking Stock’ publication from November 2020.


Deborah Sweeney, Press Adviser to Minister Donohoe – 086 858 6878

Aidan Murphy, Press Officer, Department of Finance – 085 886 6667