Ireland's unemployment rate rose to an 18-year high of 14.9 per cent in June, underscoring the country's struggle to stimulate economic growth in the face of austerity measures, government statisticians reported Wednesday.

The rising joblessness could have been worse but for Ireland's tradition of mass emigration in times of economic hardship.

The Central Statistics Office says about 76,000 left this country of 4.5 million last year for stronger job markets in other English-speaking countries — chiefly Britain, Australia and Canada — and the trend has continued this year.

Irish unemployment rose from 14.7 per cent in May. It last reached 15 per cent in March 1994, the year that Ireland began its first extended economic boom, becoming known as the Celtic Tiger.

That stellar economic expansion slashed unemployment and spurred Ireland's first-ever wave of immigration, but much of the growth proved to be fueled by cheap eurozone credit and property speculation.

Boom turned to bust in 2008 when the global credit crunch exposed reckless lending at Irish banks, forcing the government to nationalize five of them at a crippling cost. Ireland's European Union-International Monetary Fund bailout followed in 2010.

While Ireland's economy has officially eked out tepid growth thanks to export strength by Irish-based multinationals, economists say those headline GDP figures mask unrelenting recession in the real domestic economy.

Merrion Stockbrokers in Dublin published an economic outlook for Ireland that foresees a further 1.5 per cent fall this year in consumer spending, the fifth straight year of contraction.

Austerity said self-defeating

It says households are cutting back in part because so many are trapped in negative-equity mortgages on homes they can't sell, with prices set to fall another 13.5 per cent this year.

But the outlook says Ireland's effort to cut its EU-leading deficits is bearing fruit four years into a string of emergency austerity budgets. It says Ireland should be able to post a 2012 deficit of 8.0 per cent of GDP because of higher-than-expected tax collections.

That would be better than the bailout plan's goal of a 2012 deficit of 8.6 per cent. EU and IMF officials say they want Ireland's deficit back below the EU's official limit of 3 per cent by 2016, but Ireland says it intends to reach this goal by 2015.

Ireland's government says the deficit must be tackled credibly to reassure creditors and permit Ireland to resume normal borrowing on bond markets at affordable rates by mid-2013, before its bailout funds run out.

But business chiefs complained Wednesday that the government's austerity drive was self-defeating, because it was destroying jobs.

Avine McNally, assistant director of the Small Firms Association of Ireland, said the rise in unemployment was "disappointing but not surprising."

"Only when businesses feel more confident will we start to see businesses invest, grow and create employment," said McNally, whose group represents 8,000 businesses employing fewer than 50 employees nationwide.