01 September 2021
Go to release: Monthly Unemployment August 2021
The Central Statistics Office (CSO) has today (01 September 2021) issued Monthly Unemployment Estimates results in respect of August 2021.
Commenting on today’s publication, John Mullane, Statistician said:
“The COVID-19 crisis has continued to have a significant impact on the labour market in Ireland in August 2021. While the standard measure of Monthly Unemployment was 6.4% in August 2021, the COVID-19 Adjusted Measure of Unemployment indicates a rate as high as 12.4% if all claimants of the Pandemic Unemployment Payment (PUP) were classified as unemployed. This alternative measure is down from 13.5% in July 2021 and down from 17.1% in August 2020. When comparing the COVID-19 Adjusted Measure of Unemployment in different months, users should consider the impact of Government restrictions on the number of people in receipt of the PUP.
The Monthly Unemployment Rate for August 2021 using standard methodology was 6.4%, down from 6.5% in July 2021 and down from 7.1% in August 2020. In August 2021, the Monthly Unemployment Rate was 6.4% for both males and females. Breaking the results down by broad age group, the Monthly Unemployment Rate for those aged 15 to 24 years was 16.9% while it was 4.8% for those aged 25 to 74 years.
As well as the standard Monthly Unemployment Estimates for August 2021, the CSO have also published an alternative COVID-19 Adjusted Measure of Unemployment which estimates the share of the labour force in August 2021 not working due to unemployment or who were out of work due to COVID-19 and receiving the PUP.
If all claimants of the PUP were classified as unemployed, this COVID-19 Adjusted Measure of Unemployment indicates a rate of 12.4% for all persons, with a rate of 12.3% for males and 12.4% for females. Breaking the results down by broad age group, the COVID-19 Adjusted Measure of Unemployment indicates a rate of 25.6% for those aged 15 to 24 years and 10.1% for those aged 25 to 74 years.”
The PUP is administered by the Department of Social Protection (DSP). The Temporary Wage Subsidy Scheme (TWSS) was replaced by the Employment Wage Subsidy Scheme (EWSS) from 01 September 2020. There are some EWSS claims for July and August 2020 in respect of newly hired or seasonally hired employees who were ineligible for the TWSS. Both the TWSS and the EWSS schemes have been administered by the Revenue Commissioners who have provided TWSS and EWSS data to the CSO for statistical purposes and dissemination to users.
The CSO first published the COVID-19 Adjusted Measure of Unemployment in April 2020 as part of the March 2020 Monthly Unemployment Estimates release. At the time, the COVID-19 income supports were set up as temporary measures to protect those who lost income from employment due to COVID-19.
Those benefitting from the TWSS and later the EWSS, having a connection to their employer, would continue to be classified as Employed using the internationally agreed criteria for reporting on official labour market status. It was not possible to ascertain how those in receipt of the PUP would be classified using the labour market status criteria. Because of this, the CSO established the COVID-19 Adjusted Measure of Unemployment as an upper bound measure for the true unemployment rate.
This measure assumes that all those who are in receipt of the PUP would be classified as Employed for the standard measure on Monthly Unemployment and considers them as Unemployed for the COVID-19 Adjusted Measure of Unemployment. This assumption would have held in March 2020 when those who started benefitting from the PUP scheme were required to have lost income from employment to be eligible to receive the payment. The assumption would still hold for new applicants for the PUP but is unlikely to hold now for all recipients given that the scheme has been extended and some recipients have been be in receipt of the PUP for more than 12 months.
While it is not possible to ascertain how those in receipt of the PUP would be classified in terms of official labour market status based on the International Labour Organisation (ILO) definitions for employment and unemployment, any changes to the methodology for the COVID-19 Adjusted Measure of Unemployment would result in a lower rate. Thus, the CSO have decided to continue with the previous methodology for the COVID-19 Adjusted Measure of Unemployment. It is important for users to note that it is a short-term measure and designed to give upper bound rates.
This approach preserves the methodology of the standard Monthly Unemployment Estimates series while at the same time providing transparency around the impact of COVID-19 on the labour market (see - Information Note on Implications of COVID-19 on the labour market - March 2020 and the updated Technical Note for more details).
The CSO will continue to evaluate the COVID-19 income support schemes to determine whether any changes are required to the methodology for the traditional or COVID-19 Adjusted Estimates of Unemployment. Any changes the CSO may make to the methodology in the future will be clearly outlined to users in the statistical release and accompanying material.
It should be noted that the DSP has been paying arrears to recipients of the PUP, to take into account the movement of people in and out of employment. The first arrears payment occurred on 01 December 2020. All PUP arrears paid to date are included in the week of the entitlement period, rather than the week of payment. The COVID-19 Adjusted Estimates of Unemployment published today have been calculated using the latest information available.
Enquiries:
John Mullane, Labour Market Analysis - (+353) 85 862 2676
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