Irish Economy 2014: The Economic and Social Research Institute (ESRI) says in
its quarterly economic commentary published today that reliable sectoral data on
Irish jobs is not available for the first time in 60 years.
Following the issue of the Quarterly National Household Survey (QNHS) for
Q4 2013 by the Central Statistics Office, which suggested that 61,000 jobs had
been added in 2013 with about half in farming while self-employment was back to 2007,
we questioned the reliability of the data.
There was no huge jump in farming jobs in
grassroots Ireland while the data also added to a
misleading picture as the new farmers were treated as being in full-time jobs.
Irish Economy 2014: Did Ireland add 61,000 jobs in 2013?
It was also suspect that suddenly job creation would spurt to 5,000 per month
from zero in 2012.
The CSO had adjusted the figures for undercounting migrant workers
that had been picked up in the Census 2011 results.
The ESRI economists lead by
Prof John FitzGerald say: "while
we have reliable information on the trend in total employment, we do not have
good information at this point on the trend in employment in individual sectors.
This is the first time in sixty years that reliable sectoral employment figures
are not available and, unfortunately, this is happening just when we are
experiencing major problems with a range of other data. This makes it
particularly urgent that the CSO produces consistent sectoral employment data
for the last decade, taking account of the rebasing that it has recently
So the overall total of 61,000 is accepted by the ESRI - - the
QNHS has a margin of error of about 9,000 - - however, it can be possible that
the total employment figures are correct but the jobs added in 2013 were only
30,000 with say 31,000 undercounted in 2012.
This would impact the forecasts of annual job creation from this year.
The self-employment total gives rise to the question whether people just
cannot get a real jobs and are trying to raise some income as self employed.
The economists say: "in developing our forecast for the Irish economy in 2014
and 2015 we have adopted a top down approach and concentrated on the prospects
for GNP. Instead of using the latest data on trade, industrial output etc. to
build up a picture of GNP, we have relied on the current account of the balance
of payments, the employment data, and indicators of what is happening to
domestic demand as a basis for our forecast. We have then tried to 'allocate'
the aggregate level of economic activity across different sectors, using the
published data and the CSO’s guidance on exceptional items."
Prof John FitzGerald says in a separate note:
What the experience of the last two years shows is that the standard EU
harmonised national accounts are not a satisfactory framework for understanding
what is happening in the Irish economy. Instead we have to rely on extensive
commentary by the CSO on the figures that are published. Without this assistance
it would not be easy to detect the very big effects on the published figures of
issues such as the 'patent cliff,' redomiciled PLCs, and
changes in ICT sector
accounting. These problems with the standard national accounts presentation
arise from the exceptional openness of the Irish economy and the related
globalisation of the tradable sector of the EU economy. To better understand
what is happening in Ireland today significant additional data are needed,
supplementary to the national accounts, which would show the contribution of
each sector of the economy to GNP. The November 2012 release by the CSO, showing
the data on GVA (gross value added) broken down my multi-national firms and the rest of the economy,
would provide a good conceptual framework for these additional data."
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