Economic Outlook

NERI reports that the economic forecast is strong, “An overdue recovery is gaining momentum with ongoing improvements in the labour market, exports, domestic demand and earnings.”

The report projects strong GDP growth of 3.4% in 2015, declining marginally to 3.1% in 2016, and says consumption will continue its recovery, driven by rises in real disposable income.

NERI also reports that improvements in the economy will improve Exchequer finances with the government deficit falling to 2.7% in 2015 and 1.9% in 2016, alongside a steady decrease in unemployment out to 2016, with the 2015 figure reaching 10%.

Despite economic improvements, the report expresses concerns that the recovery has yet to spread across the country, “a phenomenon typified by weak or limited employed growth in regions outside Dublin and its hinterland.”

Earnings distribution and low pay

On low pay, the latest report shows that:

• 25% of employees earn an hourly wage of less than the Living Wage threshold of €11.45 per hour (approximately 345,000 employees)
• On average employees earns €20.63 per hour although 50% of employees earn less than €16.62 per hour
• 30% of employees earn below the Eurostat low-pay threshold of €12.20 per hour (approximately 400,000 employees)
• 60% of the low paid are women, with female workers facing a 34% risk of being low paid (one in three)
• 69% of employees in the accommodation and food sector are low paid, while 60% of workers in administration and support services are also classified as low paid
• The risk of low pay is much greater for employees on low hours (less than 20hrs) where more than one in two is low paid. The risk is similar (52%) for employees with a temporary contract.

Read the full report HERE.