People waiting in line for their unemployment benefits in IrelandPhotocall

IrishCentral wants to hear how Ireland's economy has affected your life. Click here...

A respected Irish think-tank will say that Ireland is set to suffer the biggest fall in output of any country since the 1930s, IrishCentral sources have revealed.

The Economic and Social Research Institute (ESRI) will also say that the unemployment rate in Ireland will exceed levels of the 1980s, with almost one in five members of the labor force seeking work.

The report will say that private sector employment will fall by over 300,000 - 17 percent - by 2010, and warns that investment will fall by 75 percent in 2010.

Details of the new ESRI report, which is due to be released Wednesday, have been shared with Irish Central.

Although speculation about the dire straits of the Irish economy has been widespread, with organizations such as the OECD and the IMF saying that Ireland is in trouble, this latest report is truly horrifying in its gloomy outlook.

And while a recovery in the U.S is predicted by some to happen as early as next year, there seems to be no light at the end of the tunnel for Ireland.

The ESRI is one of the most highly-regarded think-tanks in Ireland. Last year, it correctly predicted that Ireland would enter into a recession, the first Irish recession in 25 years. Ireland was the first Eurozone country to officially go into recession.

The ESRI has also earlier warned of a return to net emigration in Ireland.

Irish public finances have deteriorated so sharply that the government had an emergency budget earlier this month, which cut public expenditure and raised taxes.

These measures, the government hopes, should amount to €3.2 billion ($4.2 billion) this year. The government said during the budget that it expects the Irish economy to contract by 7.7 percent in 2009.

At a commemoration of the Easter 1916 Rising held Sunday, however, the Irish Prime Minister Brian Cowen defended his government’s handling of the recession.

He said that a recovery would happen because of the "prompt, speedy, consistent and forceful policy action" taken by his government.

"Since the beginning of the crisis, this government's response has been unprecedented in its breadth, its speed and its force," he said. 

"I firmly believe that history will show that we were among the first countries to recognize the scale of the crisis and to put in place a comprehensive framework for recovery."