CSO figures provide evidence of positive momentum in economy
Ibec has welcomed the strong jobs numbers recently published by the CSO. The numbers provide more evidence of broad positive momentum in the economy, despite Brexit uncertainty. Employment grew by 2.9% in the first half of the year, closely in line with Ibec forecasts.
The strongest growing sectors were ICT and construction which experienced growth of 9.3% and 7.7% in the second quarter. All regions except the Border experienced positive employment growth in the first half of this year. The region with the strongest growth was the West (5.9%) which was extremely positive given that employment in this region was lagging the rest of the country for quite some time.
Ibec Economist Alison Wrynn welcomed the figures stating: “The labour market is now approaching full employment with unemployment now at its lowest rate since 2008. However, despite these gains, our labour force participation rate is still at 2012 levels. In a European context, this rate is very low. It is currently the fourth lowest of the EU average and more than 10 percentage points lower than the top performing countries.
“Budget 2018 must include measures that will address these issues by removing barriers to work. Despite some improvements in recent years, childcare costs in Ireland remain amongst the highest in Europe. This, combined with high marginal tax rates that come into effect before one even reaches average earnings, acts as a deterrent to enter the workforce, particularly for second earners. We are already experiencing acute skills shortages in many sectors, and these will only get worse unless these issues are addressed.
“Employment in the Border region grew by 1.6% in 2016, however, it fell in the first half of this year. This may be the first sign that Brexit is having a negative impact on the labour market. To minimise these losses, the upcoming budget must include measures to help companies through this difficult period by providing supports for market diversification, innovation and cost competitiveness.”