Market Overview

The Irish labour market is showing resilience amidst economic uncertainty in the region. Employers anticipate a strong staffing climate during Q3 2023, with a Net Employment Outlook (NEO) of +26 percentage points. This indicates a positive sentiment among hiring managers, with a 4-point increase compared to the previous quarter. However, there is a decline of 14 points compared to the same quarter last year, reflecting the challenges faced during the pandemic.

Ireland ranks in the top half in the region for its employment outlook, 6 points above the regional average. This is likely due to the country's strong economic outlook and growth prospects, outperforming the rest of the eurozone in the previous year. The Irish economy is expected to continue its growth trajectory in 2023, driven in part by attracting large multinational corporations.

40% of employers in Ireland are planning to expand their workforce in Q3 2023, indicating optimism about future business prospects. Meanwhile, 45% plan to maintain their current workforce, showing stability, and only 12% anticipate making redundancies.

The Jobs Index from IrishJobs reveals a more settled jobs vacancy market compared to recent years, with a slowdown in the rate of vacancies declining Quarter-on-Quarter to 4%. Overall, vacancies fell by 25% Year-on-Year, reflecting the surge in hiring experienced in early 2022, which has since stabilized.

The Central Bank's Quarterly Bulletin highlights that headline inflation has declined, but core inflation is on the rise and expected to be 4.9% in 2023. Despite challenges in the global economy, the unemployment rate in Ireland is below 4%, the lowest since 2004, indicating tight labour market conditions that are expected to continue.

While Modified domestic demand is forecast to grow in 2023, 2024, and 2025, GDP growth has been revised down due to volatile data and revisions relating to the export and multinational sectors. The Irish GDP contracted by 4.6% in the first quarter of 2023, mainly driven by the industrial sector. However, this is expected to be a temporary decline, as industrial output rebounded in April. Nevertheless, challenges in the global economy may lead to a slowdown in Irish export performance in the coming years.

Overall, Ireland's labour market is displaying resilience and optimism, supported by strong economic growth prospects and a positive employment outlook for Q3 2023. However, some challenges, particularly in the export sector, warrant monitoring in the coming months.