Economic crash to drive 100,000 out of Ireland

Just three years ago, when business was booming for Paul Lynch, a plumber from Tallaght, Co Dublin, nothing could have been further from his mind than the prospect of leaving Ireland in search of a new life overseas.

But like thousands of unemployed, skilled workers, a year without a steady job has been enough to convince him to up-sticks and move abroad.

"I'm a total homebird – even when I go on holiday, I end up in an Irish pub somewhere," said the 34-year-old. "But right now, I'm penniless. I'm just not one of these people who can pick up the dole. I want to work. I've heard some great things about Canada."

With the unemployment rate still above 13 per cent and remaining high, many with a bankable trade are now considering taking the drastic option of leaving Ireland in search of work.

The government expects as many as 100,000 people to leave over the next four years. In most cases, it is a decision taken with the utmost reluctance. Mr Lynch said he would be leaving his wife and six-month-old son behind initially while he secured a job.

A new wave of emigration would be one of the most painful symptoms of Ireland's financial crisis, which continued to be the subject of a fraught political stand-off yesterday. Brian Cowen, the under-siege Irish Prime Minister, again emphasised his government was not in need of a European bailout. However, finance minister, Brian Lenihan, conceded the country's banks needed help. A mission of EU and International Monetary Fund officials will visit Ireland today, in the latest attempt to resolve a debt crisis which some fear is putting the nation's European partners at risk. Mindful of the potential knock-on effects on the UK's economy, George Osborne declared that Britain also "stands ready" to play its part in any rescue plan, over the objections of some Tory MPs. But further evidence for the impact of Ireland's woes came as Portugal's borrowing costs sky-rocketed on the back of traders' worries over the "contagion effect" caused by the country's crisis.

The atmosphere was so tense in Dublin that a prankster posing as a television journalist caused a brief constitutional crisis by suggesting the Irish health minister, Mary Harney, had resigned over the bailout talks. Her departure would have left the ruling coalition with a wafer-thin majority of just two votes. However, it later emerged the "reporter" who had begun the speculation was actually a comedian with the Irish TV show, Republic of Telly.

While some had time for jokes, other workers joined Mr Lynch last night at an information session laid on for those considering a move to Australia or Canada. They were warned that they would not be able to pitch up in Sydney or Alberta and start earning a fortune. But they heard work was around if they bided their time and were prepared to head to less well-known areas. Sean Heading, the Technical Engineering and Electrical Union official responsible for the event, said he had watched over the last few months as more skilled craftsmen – plumbers, engineers, carpenters and electricians who have become victims of the construction industry's demise – came to him for help.

"Some have found themselves out of work for a month or two, but we are now starting to see people who have not had work into a second year," he said. "Giving people emigration advice is not necessarily what we want to be doing, but we are doing it for all the right reasons. Many of our members have been inquiring. It's not a decision you make overnight. These guys have families and lives here, but they are considering their options."

Some analysts warn any significant emigration could turn the country's immediate debt and spending problems into a longer-term "brain drain" crisis, with an army of skilled workers, who learnt their trade in Ireland, lost to other nations.

"It is a heart and the head situation," said Michael Casey, former chief economist of the Central Bank of Ireland and author of Ireland's Malaise. "Most Irish people want to stay where they are, but if you think about it, the head suggests something else. A brain drain on any scale would be a loss to the country. The middle class is the backbone of an economy and trained workers are the seed laid for the future.

"There is a danger that the current fiscal retrenchment could lead to a longer-term problem."

Frustrated workers who have decided to stay put now face the prospect of huge public spending cuts, something that has provoked them into taking their protest to the streets.

A national demonstration has been called by the Irish Congress of Trade Unions for later this month. The march, on 27 November, is designed to put pressure on the government to find alternatives to its plan of making a further €15bn (£12.7bn) cut to public spending in next month's austerity Budget.

If a further bailout for Ireland's banks is secured, economists warn that even worse economic fall-out could be on the horizon. In particular, should shoppers stay away from the high streets in even greater numbers and investors be scared off from the lack of demand, the spectre of Japanese-style deflation looms.

In practice, that would mean Ireland could be left with ghost-like precincts in more of its inner cities to match the "ghost estates" of homes and offices built during the boom years and never occupied.

"There are some bright sparks," Mr Casey said. "People have a better sense of reality now. We know we have to buckle down and do the hard yards.

"We have to start doing the simple things well. It is up to us all to work harder to get through this. The Celtic Tiger is dead and buried."