Ireland’s economic recovery and rapid private sector investment growth has left the public sector lagging behind the rest of the economy, according to the employers’ body Ibec.

In a recent speech to a business leaders‘ conference, Ibec chief executive Danny McCoy business had become “too big, too fast for our society to cope with because the public realm has not scaled quickly enough.”

He said the ratio of private to public sector jobs was now 25 to 1, following the creation of 400,000 private sector jobs since 2014. He described this as a “dramatic imbalance,” and said the ratio of private to public jobs is now “out of kilter.”

Mr McCoy said the imbalance was creating surging demand for public infrastructure and public services, resulting in an intense public debate about housing, health and quality of life. This was reflected in the recent general election.

Fórsa general secretary Kevin Callinan commented: “In the depths of the economic crisis progressives argued that the problem wasn’t that the public sector was too big, rather the private sector was too small.

“Now, with a strong recovery in Ireland, it’s the growth - and the potential for further growth of the private sector - that’s highlighting the fact that the public sector is too small.”

McCoy said: “The key point is we have allowed parts of the public service to become proportionately too small for business and society to continue to thrive.”

He also emphasised the need for social dialogue on issues like public infrastructure, public services, carbon reduction targets and the effects of Brexit. He said Ibec and the Irish Congress of Trade Unions had already had positive contacts on the issue.

“Ireland needs to build a new national consensus to help provide solutions to these challenges. A new social dialogue forum would consist of a range of stakeholders including business representative groups, trade unions, NGOs and other players in the civil society arena,” he said.

McCoy’s earlier call for a new social dialogue process last September was welcomed by Kevin Callinan, who said renewed social dialogue could resolve or improve issues including childcare, education and housing.

“The outgoing government’s approach to social dialogue sought to limit the opportunities for employers and unions to work with government to craft solutions to basic problems that affect workers but also impede the potential for business development. We need investment in transport, housing, education and training, and our public health system,” he said.