By Andrew Bushe
DUBLIN — With 5,200 people signing on for state benefits last month and series of further job shocks last week, Tanaiste Mary Harney has warned against talk of a recession that could further imperil the economy.
With almost 1,200 jobs lost in one day last week and cancellation of an 800 jobs at the U.S. high-tech IDA development in Cavan, Harney revealed she was tightening up the granting of work permits to non-EU immigrants.
She emphasized that the economy is still fundamentally sound and sought to calm fears.
“We are not into a recession, we are into a slowdown,” she said. “Clearly, we are affected adversely by the global downturn and that was compounded by Sept. 11. When world trade was growing, when growth was going up, Ireland did extremely well. When it is contracting, we are going to feel the affects of that.
“I am concerned about what is going to happen over the next couple of months. Consumer confidence in the U.S. is at an all-time low. Right now, many investors are long-fingering decisions because of the uncertainty.
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“We have to respond to the different situation we find ourselves in and above all remain competitive, stay attractive for foreign investment. If it’s not competitive to do business in Ireland, people will go elsewhere.”
Central Statistics Office figures show that in October there was the first year-on-year increase in the Live Register since September 1996.
The unemployment rate increased to 3.9 percent, the highest for a year and up from the record low of 3.7 percent.
However, many being laid off are still working through notice periods and have yet to show up in the figures. Also still to come are the Aer Lingus job losses.
There is also concern about possible layoffs at FSL ‘rospace, which employs 1,600. Formerly the TEAM Aer Lingus aircraft maintenance firm, its Danish owners have lost business since the terrorist attacks hit air travel.
There are more than 60,000 foreign workers in the country, but the government is cutting back.
“One of the safety valves we do have is to restrict the number of foreigners we grant permits to,” Harney said. “That decision under way. We are going to adopt a more conservative approach to the granting of work permits.”