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News : Irish Economy Last Updated: May 27, 2014 - 9:10 AM

Irish Jobs Data 2013/ 2014: Finfacts' doubts were proven right; Bruton was wrong
By Michael Hennigan, Finfacts founder and editor
May 26, 2014 - 2:52 PM

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Irish Jobs Data 2013/ 2014: Finfacts' doubts about the data that was published in March in respect of 2013 were proven right when the CSO reported today that total employment at end of March 2014 was 22,000 below the published count at end December 2013. At a press conference in April which I had attended, Richard Bruton, enterprise and jobs minister, rejected any doubts about the data.

On a seasonally adjusted basis, employment rose by 1,700 (+0.1%) in the quarter. This follows on from a seasonally adjusted increase in employment of 10,600 (+0.6%) in Q4 2013.

The CSO reported last March that total employment had grown by 61,000 in 2013 to 1,910,000 while today, the agency reported that employment was at 1,888,000.

Most economists went with the flow and ministers were distributed a 'talking point' that jobs were being created at a rate of 5,000 a month -- the CSO had issued a caveat about its 27,000 annual jump in employment in 'Agriculture, fisheries and forestry' but that was ignored.

Besides, there was no net jobs creation in January-December 2012 and in the real world, suddenly jobs wouldn't have arrived like manna from the heavens in 2013. 

When I was back in Dublin I put it directly to Richard Bruton, enterprise and jobs minister, that the jobs data was unreliable but he rejected it out of hand - - it was too good a propaganda point to express doubts about.

In April, Prof John FitzGerald of the ESRI, had said that sectoral unemployment data was unreliable for the first time in 60 years.

Finfacts, March 2014: Irish Economy 2014: Did Ireland add 61,000 jobs in 2013?

  • Doubts remain about the data as "Agriculture etc." in the eral world did not add 14,000 jobs in the 12 months April- 2013-March 2014;
  • Some 85,000 unemployed or 4% of the workforce who are in public activation programs, are counted as employed or in education;
  • Self-employment (without employees) jumped by 16,000 in 12 months and the total is back to boom times -- there is no entrepreneurship miracle and many of these people likely are seeking proper paid work.

Conall Mac Coille, chief economist at Davy, commented: "At face value, today’s Irish labour market data are a little disappointing. Surveys of companies’ employment intentions and buoyant tax revenue growth pointed to a robust gain in employment in early 2014. But employment grew by just 0.1% in Q1 on the quarter, up 2.3% on the year. This marks a slowdown from the 3.3% annual rate of job creation recorded in Q4 2013. In addition, the unemployment rate has been revised up to 12.0% in Q1, albeit it is still estimated to have fallen to 11.8% in April, exactly in line with the euro-area aggregate.

However, aggregate employment growth figures have been pushed down by weak part-time jobs data. The marginal 0.1% rise in Irish employment in Q1 was split between part-time employment down 1.0% on the quarter, and full-time work up by 0.4%. Full-time jobs are up 3.3% on the year but part-time jobs are down 0.8%.

This weakness in part-time work could relate to the retail sector, where employment fell by 5,900 on the year. However, the broader picture is that retail jobs appear to have levelled off around 270,000 and should benefit from the brighter outlook for consumer spending. As in the UK, part-time work in Ireland grew through the recession as full-time work fell away. It now appears that part-time work is being replaced by full-time employment. So, even after accounting for the fall in part-time work, the pace of full-time employment creation clearly moderated slightly in Q1.

At a sectoral level, Irish job creation remains reasonably broadly based. Manufacturing had contributed to jobs growth in 2013, but was down 0.4% in the year to Q1. In contrast, construction sector employment is up 6.2% and services by 1.7%. Within the services sector, employment rose in hotels and restaurants (13,500), information technology (+3,300), professional and scientific activities (11,800) and administration and support services (+3,000). Retail (-5,900), finance (-1,900) and health and social work activities (-3,200) detracted from employment growth, with the latter sectors hurt by public sector job cuts. Public sector jobs fell by 2,500 in the year to Q1 to 375,500, down 0.7%. In contrast, private sector jobs are up 2.6% on the year."

Brian Mandt, Ibec senior economist, said: "Companies remain confident in Ireland's economic development and continue to hire. An improving labour market should translate into greater consumer spending and further positive knock on effects across the economy.

"Today's figures are consistent with our forecast of a nearly 2% increase in private consumption this year. The improvement was broad based. Nine out of fourteen sectors contributed positively to the increase in overall employment. Strong increases were noted in professional, scientific and technical activities, as well as the accommodation and food service activities, but the financial sector continues to decline.

"Employment rose to 1,903m people in seasonally adjusted terms, the highest level since Q1 2010. It is particularly positive to see that all the new jobs have been full-time positions, which increased from 1.447m to 1.454m. Unemployment, on the other hand, continued its downward trend. Seasonally adjusted the unemployment rate is now at 12 %, the lowest level since Q1 2009.

Brian Mandt said employment so far have been the best indicator for the condition of Ireland's economy and should continue its positive performance in the coming quarters. 

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