The Nevin Economic Research Institute (NERI) have today released their latest Quartely Economic Report for Spring 2017.
The report shows that Employment growth averaged just under 3% in 2016 with end-year total employment reaching an estimated 2,048,100. This was the highest fourth quarter total since 2008, though employment is still 100,000 below its 2007 level.
Unemployment and long-term unemployment are on steady downwards trajectories according to the report.
Meanwhile, the recovery in wages has been much more modest, by comparison. Average weekly earnings grew by 0.6% year-on-year in the fourth quarter with private sector earnings increasing by 1.4%.
NERI believe the economy is not yet overheating and that there remains some limited scope for above trend growth and the working through of pent-up demand. They expect GDP to increase by 3.8% in real terms in 2017 before slowing to 3.0% growth in 2018
The Institute claims domestic demand (consumption and investment) will drive the bulk of real GDP growth in 2017 and 2018.
Overall, NERI say total employment should continue to grow strongly for the rest of 2017 before slowing in 2018. They project that unemployment will fall to 5.8% by the middle of 2018 as cyclical unemployment disappears.
The report indicates that the outlook for trade is highly uncertain given the volatile policy environment and the outsize impact of a small number of multinationals. Brexit effects could manifest as weaker foreign demand while changes to US policy could affect the scale and type of economic activity undertaken by US multinationals in the Republic.
According to the report, the greatest social crisis impacting on workers, families and communities in the Republic of Ireland is the lack of affordable quality homes.
Commenting on the launch of the report, NERI Director Dr Tom Healy said, "Housing has been a major social policy failure. We do not see current Government plans working on a sufficient timescale to deliver enough new homes to meet continuing demand. The crisis in accommodation points to systematic market failure. A new vision based on a mixed economy of public, private and voluntary involvement is required to tackle the crisis which may take at least a decade to resolve."
Source: www.businessworld.ie
