Jobs boom is not unique to Ireland but quality is the key
It remains to be seen when Fianna Fáil will decide that it makes sense — from a purely selfish political point of view — to plunge the country into a general election. Given how dysfunctional our political system has been since February of last year, perhaps the earlier we have an election the better.
The risk, of course, is that we just end up with the same sort of government, with Fine Gael swapping deck chairs with Fianna Fáil being the only cosmetic difference and nothing much would change in terms of political governance.
Whoever the next leader of the country is, the one thing that they can say with conviction is that the economy is in a much better place than when Enda Kenny assumed power in 2011. Mind you, it would be difficult to be in a worse place.
I have always argued that the most important economic indicator of the lot is the level of employment in the economy. Obviously, employment data must be assessed in terms of the quality of the employment that is being created, but getting a job can lessen many social, economic and mental health problems. In this regard, Ireland is doing pretty well at the moment, having experienced a very dramatic and damaging labour market shock after 2007. If it were not for the safety valve of emigration, the situation would have been considerably worse. Forced emigration is never a good thing, but for the people involved it represented the least worse option and hopefully they will be the better for it. The alternative would have been to remain in Ireland and become a long-term unemployment statistic, with all of the evil and misery that entails.
The latest data contained in the Quarterly National Household Survey (QNHS) show that employment increased by 68,600 or 3.5%, in the year to the end of March. The total number at work in the first quarter stood at 2.045m on a non-adjusted basis and 2.064m on a seasonally adjusted basis. The sectoral breakdown of the employment change is strong and reassuring. All but two sectors recorded strong growth in the previous 12 months, illustrating the broad-based nature of the recovery.
The overall increase in employment was made up of a very strong annual increase of 84,200 or 5.5%, in full-time and a decline of 15,600 in part-time employment. These changes are really indicative of the strength of the overall labour market and the improving confidence of the business community. The overall employment rate for people aged between 15 and 64 years is now up at 65.4%. The long-term unemployment rate has fallen to 3.6%, but long-term unemployment still accounted for 53.8% of total unemployment. A note of caution is that we lack qualitative data on the nature of employment being created.
Indicators of consumer activity such as value growth in retail sales, car sales, consumer confidence and income tax returns would suggest that a lot of the jobs being created are not particularly well paid. The hope would be that as time passes and the economic momentum continues to build, the quality of the labour market will improve further. What is most probably happening in the Irish labour market is not unique and has, for example, been a strong feature of the US labour market performance in recent times. The challenge is to continually seek to go up the value chain and create as many well paid and high quality jobs as possible.
