(Bloomberg) --

Irish unemployment may surge to the highest level since the 1980s, as the coronavirus takes an unprecedented toll on the economy.

The jobless rate could rise 18% in the second quarter, the government-backed ESRI think-tank said on Thursday, should current restrictions remain in place for 12 weeks as planned. About 350,000 people would lose their jobs, the think tank said, with unemployment jumping from below 5%.

“The labor market, which had been in a position of strength before the spread of the pandemic, is set to face the largest one quarter shock in living memory,” the ESRI said. Even then, “this current scenario may turn out to be too benign” as the crisis unfolds, it added.

Ireland has closed non-essential stores, told workers to stay from home if possible, and limited gatherings of more than four people. The nation has recorded over 1,000 confirmed cases of the virus, with that number set to rise. Even if the economy recovers swiftly from the partial shutdown, GDP would shrink 7% in 2020, the ESRI said.

The general government balance is set to drop into a 4.3% deficit, the ESRI said.

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