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News : Irish Economy Last Updated: Mar 22, 2014 - 2:38 PM


Irish Economy 2014: Did Ireland add 61,000 jobs in 2013?
By Michael Hennigan, Finfacts founder and editor
Mar 6, 2014 - 6:58 AM

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Irish Economy 2014: Last week the Central Statistics Office's (CSO) report, which showed that 61,000 jobs had been added in Ireland in 2013 triggered elation among government ministers and superlatives were used with abandon across most of the media. After a half decade of grim news, it was surely time for a celebratory drink?

In fairness as we Irish say, the CSO did include a caveat but ministers in particular, with their addiction to spin, do not do nuance.

In the US monthly and annual revisions of the Bureau of Labor Statistics' nonfarm employment report, which is based on two separate surveys: of households and business establishments, are regularly published while in Ireland, the CSO revises data based on the quinquennial census while estimating the working population between the census results.

We have updated the content here with information received from the CSO and the Census 2011 results showed that the working age population (persons aged 15 or more) was 3,599,100 compared with an existing estimate of 3,502,700 (based on Census 2006's result of 3,375, 399) - - a difference of 2.8% (96,400).

The updated non-Irish national working age population for Q2 2011 was 103,100 (27.6%) higher than the previously published estimate -- 476,900 v 373,800 - -  and the number at work was revised up by 48,300 in Q2 2012. See here [pdf] for more information. Data back to 2006 was also revised. See Chart 1 above.

In unadjusted terms there were 395,411 people signing on the Live Register (which includes casual and some part-time workers) in December 2013. The CSO said this represented an annual decrease of 28,322 claimants (-6.7%).

Based on the Quarterly National Household Survey (QNHS) data [pdf], most of the job creation happened in the period April-September last year and the rise by 3.3% in the year should have positively impacted income tax receipts but income tax collections of  €15.76bn in 2013 were down €102m compared with target and up €582m (DIRT was €160m down while Schedule D business income tax was up €60) compared with 2012.

In January/February 2014, income tax collections were at a similar level to the same period in 2013 while social protection spending was up 0.6% compared with 2003 but that is in respect of total spending as data on unemployment payments are not available.

 'Agriculture, forestry and fisheries' as Chart 2 shows, has had a similar pattern of employment since 2000 and it has the lowest ratio of foreign workers at 7.5%.

However, employment has risen by 37,000 since end 2011 and 27,000 since end 2012 according to the Q4 2013 estimate - - this is a fairytale.

Coillte, the state forestry company, has about 1,000 on its payroll, and Bord Iascaigh Mhara, the fisheries agency said in respect of 2012 that 11,000 persons were employed in the Irish seafood industry, of which:

  • Fishermen 4,984;
  • Fish farmers 1,716;
  • Processing 2,860;
  • Ancillary 1,140.

Beef and dairy prices have been strong through the crisis and while farm income has been volatile - - down 30% in 2009, up 48% and 32% in 2010 and 2011 - - there hasn't been much reason for the traditional béal bocht!

There may have been a problem in tracking full-time construction workers who were part-time farmers, losing their jobs.

For example in the Q4 QNHS, the number of self-employed without employees rose by 29,000 in the year - - entrepreneurship in the real world cannot be magiced up so easily.

'Accommodation and food service activities' provided an additional 17,000 jobs in 2013 and that is consistent with tourist traffic.

While 25% of the 2013 jobs were filled by foreign nationals, they accounted for almost half the additional tourist activity jobs -- that again is not a surprise.

Jobs in 'Industry' are down from 285,000 in 2007 to 243,000 in 2013 -- and 244,000 at end 2010 and 2011.

This data is consistent with industrial production data which shows a 14% dip in the 'Traditional' volume index (mainly covering indigenous firms) in 2009 to 86.2 and it was 86.1 in 2013.

The CSO has extracted public employees from categories such as 'Health etc' and 'Education' and excluding Semi-State employment of about 50,000, employment has fallen from 349,000 at end 2010 to 327,000 at end 2013. There was a fall of 5,500 in the year.

Besides 'Construction,' after an initial drop of 43,000 in 'Wholesale and retail etc,' employment in this category has been stable since the end of 2009.

The CSO told Finfacts on Thursday in respect of the 'Agriculture etc.' category:

We had also previously flagged this in 2009/2010. We had indicated that the fall in the sector at that time was linked to the sample then introduced and should also be interpreted with caution. CSO has indicated that it will examine the issue going forward and consider what further can be done, if anything. Any updates regarding the matter will be communicated to users. Any impact on other sectors, self-employed would be examined as well. We will also, of course, be evaluating additional information as it becomes available over the next number of releases."

Employment did rise in 2013 but not likely by 61,000 and we can say with confidence that there was not an increase in full-time employment of 54,300 (+3.9%). The adjustment to 'Agriculture etc' in effect is to correct undercounting since the start of the financial crisis.

The number in self-employment without employees was at 237,000 at end 2007 and 236,000 at end 2013. The rise of 29,000 in 2013 includes the phantom jump in full-time farmer numbers - - this is why most of the jobs added were full-time and 50,000 of them went to men.

Finfacts: Irish adjusted GNP in 2013 estimated at 1% compared with official level of 3.4% 

Employee numbers up 22,000 since 2010

Besides farmers, how many of the self-employed have what would be viewed as real jobs? How many are 'consultants' for example as they try to get a job?

The number of employees (workers in companies and for sole traders) grew by 28,000 in 2013 and is up just 22,000 on 2010 and down 206,000 on 2007.

There were 143,000 part-time workers in 2013 who are seeking full-time work, The number was 2,000 in 2007.

There is a simple way of looking at the jobs situation in 2013 by focusing on the big sectors of the economy: IDA Ireland and Enterprise Ireland have said that their client companies added 12,000 net jobs in the year. Coupled with tourist activity related jobs, that amounts to 29,000. Public sector employment fell while 27,000 additional farmers/farm workers in 2013 is fairytale economics.

Simply, the volatility in farm employment during the crisis is a fiction and the apparent jump in 2013 may be real for Enda Kenny, taoiseach, but it's a fantasy as is the goal of achieving full-employment by 2020 without a credible strategy. 

As for income tax, each year the numbers at work turned out to be higher than originally forecast.

With the Eurozone in recession and the good news on the UK economy coming in the second half of the year, coupled with SMEs struggling to get bank loans, the backdrop had not significantly changed.

The CSO has reported that both Irish industrial production and services fell in 2013.

Also in 2013, the number of Irish home mortgages issued in 2013 fell to a 40-year low and most of the 86,000 unemployed who were in publicly funded activation programmes such as JobBridge, were classified as being employed -- that is equivalent to adding 4% to the unemployment rate giving a real world total of 15.9%. 

Nevertheless, the economy is at last recovering but achieving full-employment by 2020 cannot be achieved by political spin.

Irish Economy 2014: Jobless exports boom 2000-2013; What will change to 2020?

Jobs in Ireland's foreign-owned sector in 2013 below level in 2000

Irish Economy: Full-time jobs in indigenous exporting firms in 2013 below 2000 level

Irish Medium-Term Economic Strategy 2014-2020: Exports to plunge by €50bn - Parts 1-8 --Part 8: 300,000 net new jobs by 2020 via prayer or strategy?

Irish Economy 2014: Gilmore launches Lilliputian wish-list on trade and tourism

Irish Corporate Tax 2014: How official spin and distortion works - in short-term

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