Employment in the Irish economy has risen by 650,000 since the post-crash low of 2012, according to the Central Statistics Office (CSO). Over the same period, unemployment fell from just more than 350,000 to approximately 120,000.
The CSO’s latest Labour Force Survey highlights the remarkable turnaround in the labour market here since the economy was brought to its knees in the wake of the 2008 financial crisis.
The survey indicates that employment hit a new record high of 2.55 million in the third quarter of 2022 on the back of the lifting of Covid-related restrictions and a strong bounce-back in consumer spending. The number of working-age adults in employment has risen by 3.4 per cent, or 83,000, over the past 12 months.
However, the quarter-on-quarter increases in employment have slowed, prompting suggestions that the labour market had reached its peak.
The economic sectors that saw the most significant year-on-year growth were the human health and social work sector, which saw employment increase by 30,100 or 9.8 per cent; construction (up 24,600 or 16.8 per cent); information and communication (up 12,200 or 8.3 per cent) and the industry sector (up 23,300 or 7.6 per cent).
The data, however, shows employment in the tech-dominated information and communications sector fell by 11,000 – or 6.6 per cent – during the third quarter, to 158,800, a reflection of the global slowdown in tech, which has triggered a spate of job losses. The figures predate the recent high-profile lay-off announcements by Twitter, Facebook-owner Meta and Stripe.
The agricultural, forestry and fishing sector, the financial, insurance and real estate sector and the accommodation and food service sector recorded year-on-year declines, the CSO said.
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All economic sectors had greater numbers in employment in the third quarter when compared with pre-pandemic levels, with the exception of the agriculture, forestry and fishing, which was 4.7 per cent lower.
The rapid pickup in inflation has, however, clouded the employment outlook going forward with several agencies forecasting a marked slowdown in headline growth.
The Irish Fiscal Advisory Council warned earlier this week that weaker real incomes would lead to flatter consumption patterns in the coming quarters.
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The CSO’s latest survey pointed to an employment rate – the number of people of working age in the population who are employed – of 73.2 per cent in the third quarter. It also pointed to an unemployment of 4.5 per cent, down from 5.7 per cent in the corresponding quarter of 2021, the lowest level since 2005, and a level that economists suggest is close to full employment in the Irish economy.
Overall, there were 119,100 people classified as unemployed in the third quarter.
The number of males in the labour force increased by 2.6 per cent (+35,800) to 1.4 million, while the number of females in the labour force increased by 1.4 per cent (+17,200) to 1.24 million.
The overall participation rate – a key metric – stood at 64.8 per cent in the third quarter, up from 65.1 per cent a year earlier
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The participation rate is a measure of the economy’s active workforce, in other words those working and those seeking work. The participation rate for males was 70.8 per cent in the third quarter, compared with 58.9 per cent for women.
Before the pandemic the participation rate for women was 56 per cent. One of the most striking features of the Covid crisis was the increased number of women in the workforce, suggesting that the shift to remote working facilitated greater participation.
However, the participation rate for women has fallen again since the pandemic abated.
“The Irish labour market reached more new highs in Q3 2022, but the rate of improvement eased substantially leading us to believe the market is now close to peak,” Goodbody’s chief economist Dermot O’Leary said.
