The West of Ireland is operating at ‘full employment’ according to the latest figures which reveal another drop in the unemployment rate.

But conversely, the employment figures are so strong that it has led to fears within the Department of Finance of a shortage of workers in some sectors.

The Central Statistics Office confirmed there were now over a quarter of a million people working in Galway, Mayo and Roscommon.

The latest Labour Force Survey for the second quarter of 2023 highlighted the unemployment rate in the region was now 3.7%.

Full employment – where everyone who wants to work can find a job at the current wage – in Ireland occurs when the unemployment rate dips below 4%.

In the West, unemployment dropped by 0.1% in April, May and June of this year. Nationally, the unemployment rate stood at 4.4%, according to CSO.

Its survey found there were 251,200 people employed in the West, with 9,600 people unemployed.

The labour force participation rate (number of people over 15 who are working or looking for work) in the West was 65% in the second quarter of 2023.

Nationally, employment continued to grow with 87,400 jobs created in the year to July with total employment now 2.63 million.

The CSO noted the regions outside Dublin had driven much of the jobs growth with the West adding an additional 6,000 jobs in three months.

Two Cabinet Ministers hailed the data as ‘reflective of the success of the Government’s Economic Recovery Plan after Covid-19.

Minister for Finance, Michael McGrath said the figures showed the strength of the labour market, as the employment rate rose to an all-time high of 74.2%.

“This is a significant achievement given the economic headwinds faced in recent years and points to the resilience of the labour market and the success of Government policies introduced in response to these challenges,” he said.

Minister McGrath said despite job losses in the second half of last year in the ICT sector, employment in ICT rose by 2.2% in the second quarter to a new record high of 174,000.

But he cautioned that the labour market was now “operating at or possibly beyond capacity”.

“With labour demand still strong according to job postings, the labour market is likely to remain tight over the near term,” he said. Mr McGrath said this could contribute to “accelerating wage pressures”.

Minister for Enterprise, Trade and Employment, Simon Coveney said: “For another successive quarter, we have reached a new record for the highest number of people employed in our country than ever before, with the monthly unemployment rate standing at just 4.3% in July. It is a testament to the hard work and remarkable resilience of Irish enterprise.

“Female participation rates in the labour market in particular are now at historic levels, with more women availing of opportunities for employment.”