Employers are warning that the Pandemic Unemployment Payment may be making it harder for businesses to find workers.

It comes after it emerged that nearly 40% of people receiving the payment are currently better off than they were when they were working.

With around 585,000 people receiving the payment, it means that over 220,000 people may be better off now than when they were working.

On Newstalk Breakfast this morning, the Taoiseach Leo Varadkar said the situation was “not fair” and “not sustainable” – and said officials are working on ways to improve the system.

He also warned that anyone who refuses to return to their job in the coming weeks will lose the payment.

Earlier in the programme, Fergal O’Brien from business lobby group IBEC said the few companies that are expanding at the moment are finding it hard to source staff.

“Clearly a scheme that is delivering an income increase for 200,000 people at the height of a crisis such as this doesn’t seem like the best use of public resources and does raise a lot of issues in the context of fairness,” he said.

“We do have members already reporting to us that they are finding it hard to get people to take up open positions.”

He said the system needs a proper incentive to work if people are to be encouraged to take up job offers.

Earlier this month, the ESRI found that 8% of the country’s workers are on the minimum wage.

It noted that more than half of these work in the retail, accommodation and food sectors – which have all been severely affected by the COVID-19 outbreak.

It said changes to the minimum wage will be a “key policy question” for the next Government.

You can listen back to the Taoiseach's interview with Newstalk Breakfast here: