Dramatic Contraction in the Irish Economy

Official figures show that there was a dramatic contraction in the Irish economy in the first three months of this year.

The Central Statistics Office (CSO) in Cork states that economic output, as measured by gross domestic product (GDP), fell at an annual rate of 8.5%.

The decline in gross national product (GNP), which excludes profits from multi-national companies based here, was even bigger at minus 12%.

The CSO describes these figures as "unprecedented" and they are weaker than economists had expected. They are the worst since these particular measures began to be recorded in 1997.

The last time economic activity in Ireland fell so severely was back in the late 1950s.

There was an extremely large fall in the volume of construction output. New housing was down by 47% and there was a 20% fall in other building and construction projects.

As consumers are spending less in general, the measure of personal consumption was down by 9.1% in the first three months of this year compared to last year.

Irish Unemployment Rate now 10.2%

The latest official figures from the Central Statistics Office (CSO) in Dublin reveal that there has been a sharp fall in the overall number of people at work in Ireland.

The unemployment rate stands now at 10.2%, which is the highest level since 1997.

In the first three months of this year - up to and including March - there was a decrease of 158,500 (or 7.5%) in the number of people in employment.

The worst affected sector was the construction industry, where the number of employed people fell by 28.6%.

CSO says: Export and Import Levels are falling

Preliminary figures show that goods to the value of € 7.28 billion were exported from Ireland in March of this year. This is a 6% drop from February.

The Central Statistics Office (CSO) in Dublin states that imports into Ireland were unchanged at a value of € 4.14 billion. The figures are adjusted to take seasonal variations into account.

Detailed figures for the first two months of 2009 show that imports slumped by 25% to the value of € 10.7 billion, as spending power in the Irish economy weakened, with imports of road vehicles plummeting by 74%.

Imports of computer equipment were down 34%, while imports of all types of machinery were "down sharply".

There was a 4% fall in exports in the first two months of 2009, compared with the same period last year, to the value of € 13.9 billion, with electrical machinery down 40% and computer equipment down 29%.

Exports to China were down 24% in the first two months of this year, while exports to Britain fell by 6%. But exports to the USA were 6% higher than in the same period of last year.

Huge Increase in Working Days lost

Official figures also show a sharp increase in the number of days lost to industrial disputes in the first three months of this year.
The CSO says that 11,327 working days were lost in that period, compared with only 1,477 days in the same period of last year.
However, these figures come from only three industrial disputes, and the main factor was a one-day strike by civil servants over the pension levy in February.

First Fall in Irish Mortgages since 1990

Ireland's property market is in stagnation as house prices are falling steadily (see my entry of May 27th) and most people have neither the money nor the will to buy property at this time of economic recession and financial insecurity.

The latest monthly statistics from the Central Bank of Ireland show now the first net fall in mortgage lending since 1990.
The bank's figures for April 2009 confirm that the Irish property market has slowed to a trickle, and in some parts of the country it has dried up completely.

It is the first time that repayments on existing mortgages have been greater than new mortgage lendings since the Central Bank began this monthly statistics series in 1990. Overall, mortgage lending fell by over € 100 million last month.

The amount of money lent out in the rest of the economy also fell, reflecting concerns raised by many business groups about their great difficulties of accessing credit, or even normal business overdraft facilities to maintain proper cash flow.

The Central Bank's statistic also shows a sharp fall-off in credit card spending. The amount of money Irish consumers spent using their credit cards in April was € 180 million lower than in April of last year.

Unemployment Rate in Ireland reaches 7.8%

The latest unemployment figures from the Central Statistics Office (CSO) show another record number of Irish people signing on to the Live Register in November.

16,900 people signed up for unemployment payments or Social Welfare credits last month. This brings the total to 277,200 - the highest level since September 1996.

In the year to November, the Live Register saw an unadjusted increase of 106,864 - a jump of 66.1%. This compares with an unadjusted increase of 94,502 or 60% in the year to October.

The figures released today show that another 13,600 men signed on the Live Register in November, reflecting the ever slowing construction industry. There was also an increase of 3,300 women.

The CSO says that the standardised unemployment rate in November rose to 7.8% from a rate of 7.4% in October.

A Bag full of bad News from the CSO

There was a massive fall of 25,000 in the number of people employed in Ireland in the twelve months to August this year, according to the latest Quarterly National Household Survey from the Central Statistics Office (CSO).

This is the first annual fall in employment recorded by the CSO since 1991. The figures also show that unemployment increased by 60% during the same period.

It is the first time for 25 years that this combination of a sharp fall in employment as well as a sharp rise in unemployment has been recorded in official figures.

Men are doing particularly poorly, with the number of employed males down by 32,000 over the year, while women are faring much better, with a gain of 7,000 in employment during the year.

This shows once again and very clearly that the whole structure of the Irish labour market is changing and shifting from a male to a female dominance. There are three reasons for that:
1) The fact that most women are still earning less than a male equivalent doing the same job. Thus it is cheaper for companies to employ women.
2) The massive increase in low-skilled service jobs, which are predominantly filled with women, while there is a clear decline in manufacturing and other skilled jobs, usually held by men.
3) The ever more aggressive implication of so-called 'equality', which over-proportionally favours women and makes it increasingly more difficult for men to get a fair treatment and a proper job.

The collapse in construction has been one of the biggest drivers of the trend, with the numbers of those engaged in house building down by 40,000 compared with this time last year.
Other areas of construction expanded a little, providing some cushion for builders with a gain of 14,000 jobs on infrastructure and commercial building projects.

Employment in manufacturing is down 9,400, while the contraction in the 'leisure industry' has made another 5,400 people redundant in hotels and restaurants over the 12-month period.

It appears that the job losses are more severe for Irish nationals, as the overall employment of foreign workers is unchanged from last year.
However, the flow of non-Irish nationals into the country has slowed down to just one-sixth of the level of last year. This is not surprising. We were only attractive for migrant workers - most of them from eastern Europe - as long as there were more jobs than we could fill ourselves and more money than anywhere else. In fact, I expect that a good number of Poles will return home for the Christmas and New Year celebrations and not come back, because while Ireland is now in rapid decline, Poland shows the first signs of economic flourish and is tipped to be the next boom country in Europe.

The Emerald Islander