High Unemployment Irish Economy Essay

2409 Words Dec 31st, 2015 10 Pages
Economics Assignment

Module Title: Business Economics

Module Code: EC291

Lecturers Name: Dermot Gallagher

Word Count:00000

The current recession has had a huge effect on every day Ireland, the Celtic Tiger years are a distant memory. Gone are the days of living beyond on our means and there are very few people left in this country who have not felt the growing financial pressures. When a recession hits, Unemployment figures increase enormously. We agree with the assignment statement, in that we feel that unemployment will remain high over the coming years and we will strive to prove this statement correct in the following pages.

We feel that there are certain factors
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And what about the banks? Their problems have been well documented; Hidden loans were discovered in Anglo Irish bank, whilst the recapitalisation of Ireland’s two largest banks (AIB and Bank of Ireland) has cost the taxpayer roughly 3.5 billion each. Eventually the government had to seek ‘outside’ help, in terms of the bailout, which we will discuss later. The banking crisis has led to huge doubts amongst citizens of this country, and in turn the banks have reduced their capacity to sanction loans. This has led too many businesses being unable to expand due to lack of funding, which ultimately shows there is no confidence in the Irish economy at the moment. Without out proper funding, there is no capacity for growth, when the economy grows it creates jobs, but until this happens unemployment will remain high.

"The huge sums of money that have been put in by the government to support the banks, have not generated sufficient confidence yet. The money is enough objectively, but the confidence isn't there, and it's partly not there because investors are concerned in general about the government finances and the future prospects for growth and employment."

(Honan, Patrick, Central Bank Governor, speaking to RTE, 18/112010)

A huge factor in attracting multinational companies to these shores other than the low corporation was the fact that Ireland had gained a

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