Irish unemployment hits 10-year high

The report said the number of people claiming unemployment benefits rose by more than 7,000 last month to above 240,000--a 49.5 percent jump from one year ago. The figure includes about 27,000 people with part-time or casual jobs who qualify for state welfare.

Ireland's 1994-2007 economic boom was officially consigned to history last month when the country confirmed it had suffered two straight quarters of negative economic growth. That made Ireland the first economy in Europe to fall into recession in response to the U.S. subprime crisis, the surge in oil prices and the current threat of global financial meltdown.

Unemployment averaged 4.5 percent last year but has risen this year as property prices have slumped and inflation risen. The rise from August's rate of 6.1 percent put Irish unemployment back at a level last experienced in 1998.

The government, which over the previous decade enjoyed unprecedented budget surpluses, now faces a surging wave of red ink. Its tax take has already fallen this year more than 7 billion euros ($10 billion) below 2008 spending commitments. Finance Minister Brian Lenihan is expected to reveal the latest quarter of mammoth tax shortfalls Thursday.

Ireland is suddenly in danger of breaking its key fiscal commitment for membership in the 15-nation euro common currency: keeping its annual spending deficit within 3 percent of its tax collections. Other EU members, most notably France, have repeatedly broken this threshold but Ireland has never come close since the euro's launch in 1999.