People wait in a queue outside the Social Welfare office in Limerick, Ireland, on March 24, 2009.

When US computer maker Dell moved to the Irish city of Limerick in 1991, it brought a burst of dynamism and money to a relatively poor backwater.

Locals are left wondering if it was all a dream.

“A lot of people are suffering,” says building worker Christy Tydings, 57, at the front of a queue of over 100 people outside the local unemployment office, snaking round the red -brick building in the early morning cold.

The collapse of the property market has put him out of work but the wider economic downturn is hitting “everybody,” he says.

Ireland, which for years was hailed as the model for other small European countries to follow, was the first eurozone country to go into recession early last year and its government was due to announce an emergency austerity budget on Tuesday.

The budget will aim to limit the damage wrought by the global credit crunch storm but for many on the ground, it is already too late.

“I worked at Tesco,” said David Tench, 20, who has decided to return to his native Britain while Peter Ward says he was made redundant two weeks before Christmas.

The 33-year-old says he plans to head for Australia, a journey his ancestors made 150 years ago when Ireland was left starving by the Potato Famine.

“Two hundred and four euros a week, it’s not much,” says Ward, of the amount given to every unemployed person in Ireland, regardless of their income when employed, and for a maximum of one year.

A spouse puts the weekly allowance up by 135 euros and every child another 26 euros. For some “it is a big adjustment,” says Jim Lynch, area manager at the Social Welfare Office in Limerick.

During the boom years, unemployment almost disappeared in Ireland, replaced by growth which exceeded 10 percent in 2000. Now its jobless toll stands at 11 percent, compared to 4.4 percent in August 2007.

In Limerick, the number of unemployed has more than doubled, from 6,000 to 12,400. Its social welfare office is “the second busiest in Ireland,” says Lynch.

“I worked in this office in the 80s and the figures were quite bad back then but I fear this is worse now,” he admits.

The figures do not include the 1,900 people who will be put on the dole from Dell after May, or another 9,500 jobs dependent on the US company, according to a leaked official report.

“There’s been talk about redundancy plans for quite a lot of subsidiary companies working for Dell,” says James Houlihan, an official from the SIPTU labor union at Flextronics, a company which makes parts for Dell.

Limerick Mayor John Gilligan is under no illusions about the gravity of the situation.

“At the moment we have 11 to 12 percent unemployment but by next year we’ll be over 20 percent at least. We need huge government intervention if it’s not to become an industrial wasteland,” he says.

When the crisis hit, Limerick, Ireland’s third biggest city with some 100,000 inhabitants, had barely shed its reputation as a down-at-heel place with high crime rates and poverty levels.

The Celtic boom brought brand new office blocks, big shops gleaming with glass and metal, and suburbs with shopping centers full of the latest goods.

The arrival of Dell was a symbol of this new wealth and of the “Celtic model,” built on low taxes - 12.5 percent for businesses - and a relatively cheap and educated workforce for companies seeking to set up in the eurozone.

Today it is the same “dumping” logic which has turned on Ireland - Dell, which received over 70 million euros of Irish public money according to press reports here, is moving to Poland, where the government is offering nearly 53 million euros in aid.

“I feel very angry,” says Gilligan, pointing the finger at EU aid to Poland.

“When we joined the EU, our idea was that in the common market, we would trade with each other and we would be big enough to compete with countries like China,” he adds.

“We now have Brussels paying to take jobs from one country to another. That’s nonsense.”

Source: AFP