PASCHAL DONOHOE HAS described the predicted unemployment rate of 22% as “horrific” but said Ireland can and will rebuild its economy.

The Finance Minister yesterday gave the Cabinet a report on the projected impact of the Covid-19 pandemic on the Irish economy – as well as soaring unemployment, a 10.5% fall in GDP is expected.

Speaking on RTÉ’s Morning Ireland today, Donohoe said if the public health situation improves “we will see an improvement in economic activity in the second half of this year”.

He said the expected unemployment rate of 22% is “a horrific figure, given the scale of loss”, but added he believes this figure will go down to an average of around 14% for the year.

“So a significant decrease versus where we are now, but still too high.

“And I believe as we go into next year, we will continue to have over two million people at work in our economy, and we can get that unemployment rate down again.

“So we can and we will make progress in rebuilding as our public health allows us to do,” he said.

‘Unimaginable’ circumstances 

Donohoe added that Ireland, like many other countries globally, is “facing a very considerable economic challenge”.

“Behind every figure, there’s a family affected now by a loss of a job or a loss of income. And they are now dealing with circumstances that only a few weeks ago we all would have thought unimaginable,” he aid.

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“I also want to emphasise very strongly that just as we will recover our public health, we will rebuild our economy and we will renew our economy. We have done that in our very recent past,” Donohoe said.

He noted it is “very likely” the temporary wage subsidies being paid to people who have lost their jobs due to the pandemic will be extended beyond 12 weeks.

“The nature of that decision will depend on where we are with the economy, and where we are with Covid-19.

“Many of the measures that we have in place at the moment from an economic point of view, we cannot sustain them indefinitely, but we will be able to sustain them for long enough to allow incomes to continue to be protected where possible, and to give over 40,000 companies that are currently in our income subsidy scheme, a fighting chance of returning to economic and business,” Donohoe stated.