The unemployment rate fell to 4.4 per cent during the second quarter, according to the Central Statistics Office's (CSO) Quarterly National Household Survey.
The survey, which is considered the most reliable measure of unemployment, found there were 81,400 people unemployed at the end of July, compared with 84,900 at the end of March.
This represents a 0.2 per cent drop on the previous quarter where unemployment stood at 4.6 per cent, its highest level in three years.
However the CSO warned that when seasonal factors were taken into account there was only a slight fall of 200 in the number of people unemployed.
The figures show employment increased by 28,400 or 1.6 per cent to just under 1.8 million on the corresponding period last year. This compares with an annual increase of 1.5 per cent in the first quarter of 2003.
The CSO said part-time jobs represented "a significantly higher proportion of employment growth than in previous quarters".
Part-time employment increased by 12,400 in the year to 302,000 and accounted for over 40 per cent of the annual employment increase.
Hotels and restaurants recorded the largest increase in employment, with almost 6,000 new part-time positions being created.
The health sector and the building and construction sector also recorded substantial increases in employment.
Public sector employment rose by 17,200 in the year, significantly lower that the annual increase of 27,300 recorded in the first quarter.
A regional breakdown of the figures shows employment for the year increased by 12,100 or 2.8 per cent in the Border, Midland and Western region and by 16,500 or 1.3 per cent in the Eastern and Southern region.
Unemployment for the year fell slightly by 900 in the Border, Midland and Western region and increased by 5,100 in the Eastern and Southern region.
The Taoiseach welcomed the new figures saying they were a "solid indicator that the economy continues to perform very strongly notwithstanding the difficult international setting."
