Average earnings are up just 0.5% in the year to second quarter 2016 according to yesterday’s wage release from the CSO.
However, the aggregate figure was held back by a 1.2% cut in public sector earnings. In the private sector, wages grew by 1.5%.
This follows the 0.9% gain in 2014 and the 1.9% rise in 2015. The fastest growing sectors included construction (+3.9%), hotels and restaurants (+2.3%) and professional & scientific (+5.0%).
According to Davy Stockbrokers, "Ireland’s unemployment rate, despite falling rapidly, is still relatively high at 8.3%. So we wouldn’t expect nominal wage growth to show a substantial acceleration above 2% until the unemployment rates starts to decline towards 6%."
They added, "Indeed, this week saw the first positive migration flow into Ireland (+3,100), with immigrants (79,300) exceeding emigrants (76,200) for the first time since 2008. This included higher numbers of returning Irish nationals. Flows of returning migrants will reduce the pace at which the unemployment rate falls and alleviate wage pressures."
Source: www.businessworld.ie