Workers in consumer-facing industries such personal services, accommodation, and food and beverage are most at risk of slipping into long-term unemployment once State supports are removed, a study by the Economic and Social Research Institute (ESRI) has warned.
The research paper, entitled Managing Mass Unemployment Flows During the Covid-19 Pandemic, aims to categorise claimants of the Pandemic Unemployment Payment (PUP) on the basis of their expected risk of future long-term unemployment.
It warns that Ireland’s Public Employment Services (PES), which operates the State’s various employment supports and job activation schemes, are likely to face “substantial constraints arising from the rapid increase in jobseeker claimants”.
When the PUP scheme closes at the end of March next year, it is expected that PES will have to transfer a large number of individuals from the emergency PUP to the Live Register, the report said.
“These circumstances create a huge administrative burden that will stretch Ireland’s PES,” it said.
Using a combination of administrative and Labour Force Survey (LFS) data, the research identifies PUP claimants that have the greatest risk of falling into long-term unemployment, officially those without a job for over 12 months.
The sectors with high job loss rates were other personal service activities, such as hairdressers and beauticians; accommodation; real estate activities; food and beverage service activities; and specialised construction activities, such as demolition and site preparation.
It also classified two travel industry sectors as high-risk given the industry is likely to one of the last to resume operations and will likely experience more medium-term impacts.
High-risk sectors
The ESRI’s study noted that these high-risk sectors accounted for 13.6 per cent of total employment prior to the pandemic and make up 37.5 per cent of PUP claimants. Conversely, low-risk sectors such as finance and IT accounted for 55.4 per cent of employment before to the health pandemic and 19.9 per cent of PUP claimants, it said.
The research also highlighted that the impact of the pandemic is skewed with respect to age, with those under 25 having the highest job loss rate (46.7 per cent) but the lowest share of total employment in the economy (11 per cent).
In contrast, those aged 55 and above have the lowest job loss rate (18.6 per cent) and also a low share of employment (18.4 per cent).
With respect to geographic location, the Border region has the highest job loss rate (29.1 per cent) while Dublin has the lowest job loss rate (23.9 per cent) .
