Employment growth welcome but recovery under threat from mortgage crisis and lack of SME lending

OundFianna Fáil Spokesperson on Jobs and Enterprise Dara Calleary has warned that the limited progress that has been made in getting people back to work will be further hampered by the ongoing credit squeeze for small businesses as well as the mortgage crisis.

Deputy Calleary commented: “I welcome the figures from the Central Statistics Office today which show the number of people in employment rose by almost 34,000 in the year to June.  Any progress in easing the jobs crisis has to be welcomed.  However alongside this news today we see figures from the Central Bank which show lending to small businesses fell again in the second quarter of this year, down almost 1.5% between April and June. The ongoing mortgage crisis is also a drag on our recovery.

“It’s clear that the Government is still not doing enough to support businesses and ease the debt burden on people in mortgage distress.  The Microfinance scheme and credit guarantee schemes have not had the impact that was envisioned for businesses and they need to be revisited and re-priced in the budget.  The Central Bank figures actually show that the rate of reduction in lending to SMEs increased in the past year.  The Government needs to be much more proactive in supporting businesses and we will also be bringing forward our own pre-budget proposals in this regard.

“One major concern is the ongoing levels of emigration.  The latest information from the CSO shows 89,000 people emigrated in the 12 months to the end of April, a 2.2% increase on the previous 12 months.  We need to face up to the fact that the country is experiencing a prolonged brain-drain and generation-drain.  This is going to require a co-ordinated strategy from Government which we haven’t seen yet.


“Unless there is a comprehensive strategy to increase credit support for businesses, training and up-skilling for people out of work and an aggressive investment strategy to drive job creation we will continue to have a very weak recovery in the country.”


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