One-in-four Irish workers are earning less than the living wage threshold with female employees the worst affected, according to a study conducted by the Nevin Economic Research Institute.
The report found that 345,000 employees are on less than €11.45 per hour with female employees accounting for 60% of the total.
Some 30% of the Irish workforce earns less than €12.20 per hour, which is the EU low-pay threshold.
“While the economy continues to recover, a large proportion of workers remain in a position where their basic hourly wage fails to afford them an adequate standard of living. This issue is exacerbated by the link between low pay and short working hours,” said the institute’s senior research officer, Dr Micheál Collins.
“The risk of a two-tiered recovery remains. Employment growth in the western and northern counties remains sluggish and contrasts with the situation in the greater Dublin area where employment growth is much stronger,” Dr Collins said. The average hourly earnings for Irish employees is €20.63, though half of the workforce earns less than €16.62 per hour.
According to the report, one-quarter of low paid workers are employed in the wholesale and retail sector with almost one-in-six in the accommodation and food sector. The highest risk of low pay is for employees in the agricultural, forestry and fishing sector where seven out of every 10 employees are low paid.
Private sector employees are most at risk with 38.8% on low pay compared with 10.5% in the public sector. Of all those employees who are low paid, 65% live in households whose overall income is below the poverty line.
“Our analysis shows a link between inadequate levels of pay, low hours and insecure forms of employment. How this issue is addressed will influence the continued strength of the economic recovery currently underway,” said the institute’s Dr Tom Healy.
It forecasts GDP growth of 3.4% for this year and 3.1% for next driven by recovering consumer spending, a strengthening labour market and a ramp up in investment. It expects the budget deficit to fall to 2.7% this year and 1.9% next year.
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