06 January 2021
Go to release: Monthly Unemployment December 2020
The Central Statistics Office (CSO) has today (06 January 2021) issued Monthly Unemployment Estimates results in respect of December 2020.
Commenting on today’s publication, Catalina Gonzalez, Statistician said:
“The COVID-19 crisis has continued to have a significant impact on the labour market in Ireland in December 2020. While the standard measure of Monthly Unemployment was 7.2% in December 2020, the COVID-19 Adjusted Measure of Unemployment indicates a rate as high as 20.4% if all claimants of the PUP were classified as unemployed.
The Monthly Unemployment Rate for December 2020 using standard methodology was 7.2%, down from 7.3% in November 2020. In December 2020, the Monthly Unemployment Rate for males was 7.0% and 7.3% for females. Breaking the results down by broad age group, the Monthly Unemployment Rate for those aged 15 to 24 years was 19.4% while it was 5.4% for those aged 25 to 74 years.
As well as the standard Monthly Unemployment Estimates for December 2020, the CSO have also published an alternative COVID-19 Adjusted Measure of Unemployment which estimates the share of the labour force in December 2020 that were 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 19.6% for males and 21.3% for females. Breaking the results down by broad age group, the new COVID-19 Adjusted Measure of Unemployment indicates a rate of 44.8% for those aged 15 to 24 years and 17.0% for those aged 25 to 74 years.”
Commenting further on the COVID-19 Adjusted Measures of Unemployment, Catalina Gonzalez continued:
“The CSO has been working with the Department of Social Protection (DSP) to obtain additional data which captures the impact of COVID-19 on the labour market. Using the online mywelfare.ie service, information has been captured on whether recipients of the PUP were full-time students either at second-level or third-level for the current academic year. As most recipients have used this online service to either apply for a PUP or to self-certify their details to continue receiving the payment, analysis of the online information provided shows that at least 7.2% of PUP recipients have self-certified as being registered as a full-time student. For those aged 25 years and over this could be as low as 2.0% and over while it was at least 22.9% for those aged under 25 years.
This analysis indicates that caution needs to be exercised when interpreting the COVID-19 Adjusted Measure of Unemployment particularly for those aged under 25 years. If the PUP scheme did not exist, those persons, being in full-time education, would not be eligible to receive Unemployment Assistance or Unemployment Benefit and so would not be included in the methodology to estimate the traditional measure of monthly unemployment.”
Commenting on the COVID-19 income supports, Catalina Gonzalez added:
“The COVID-19 income supports were originally set up as short-term emergency income supports but they have been extended several times and there have been changes made in terms of the eligibility criteria and how they are being administered. While the PUP and the Temporary Wage Subsidy Scheme (TWSS) were both expected to cease in August, the PUP is now scheduled to continue into 2021 while the TWSS was replaced by the Employment Wage Subsidy Scheme (EWSS) from 01 September 2020. The CSO will continue to evaluate the current income support schemes and any new 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.”
Commenting on the approach taken today regarding the publication of the Monthly Unemployment and the COVID-19 Adjusted Unemployment Estimates, Catalina Gonzalez, explains:
“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 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 would now be in receipt of the PUP for up to nine months.
While it is not possible to ascertain how those in receipt of the PUP in December would be classified in terms of official labour market status, any changes to the methodology for the COVID-19 Adjusted Measure of Unemployment would result in a lower rate. Information is not currently available to establish the status of those who are currently in receipt of the PUP based on the International Labour Organisation (ILO) definitions for employment and unemployment. 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 be an upper bound rate and that is still the case now.
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 Live Register and the Monthly Unemployment Estimates – March 2020 and the updated Technical Note for Monthly Unemployment and COVID-19 Adjusted Estimates – August 2020 for more details).
Editor's Note:
Enquiries:
Catalina Gonzalez, Labour Market Analysis - (+353) 87 646 7535
Email: labour@cso.ie
For more information:
See Updated Monthly Unemployment and COVID-19 Adjusted Estimates August 2020 Technical Note
Catalina Gonzalez (+353) 21 453 5163 or Martina O'Callaghan (+353) 21 453 5491
or email labour@cso.ie
-- ENDS --
