IBEC says further tax increases would hit employment

     The Irish jobs market is stabilising but any new tax increases would hit employment and undermine recovery, business lobby group IBEC has warned. 

    In a new jobs report, published by the Sunday Business Post, it said that 5,030 new jobs were announced during the first quarter of the year while 2012 saw the first annual increase in employment since 2008.   But although unemployment is expected to fall this year, IBEC believes it will remain "stubbornly high through to 2014".

    "It is crucial that positive employment trends are not undermined by tax increases. Any further increase would make work less attractive, undermine the ability of companies to invest and create new jobs and damage hard-won competitiveness gains of recent years," IBEC's chief economist Fergal O'Brien said.

    The report found that unemployment decreased by 19,200 or 6.1 per cent in the year to the fourth quarter of 2012 but 18,000 of this drop was due to a reduction in the labour force due to factors such as emigration.

    It found large differences in the various sectors of the labour market with areas such as information technology increasing employment by seven per cent compared to construction where the numbers employed were down by more than four per cent.

    Employment in the private sector rose by nearly one per cent whereas the public sector saw a 2.3 per cent drop in the numbers it employs, IBEC said.

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