The economy and employment in Ireland in 2020 and beyond

The COVID-19 pandemic has disrupted the employment scene in Ireland. In the period from March 2020 to August 2020, 1 in 2 workers in Ireland had the support of the government via schemes like the temporary wage subsidy scheme. COVID-19 had turned many of those who work in Ireland to work from home, doing telework. Hence there have been increased efforts to implement a countrywide infrastructure for telework at a fast pace.

Looking at the country’s economy during the COVID-19 crisis, it’s been recorded that GDP growth fell to -3% in 2020. This was 5.9% in 2019. However, IMF estimates that the country’s economy will recover to +4.9% in 2021 and +4.3% in 2022. This will be possible due to the measures taken by the government to boost liquidity besides the fiscal stimulus provided.

The headline GDP figures in Ireland continue to remain positive. The reason for this was the resilience of the multinational corporations. This stood true even while private consumption decreased considerably. Ireland’s comprehensive fiscal package of €24.5 billion was distributed over 2020 and 2021. This package was the largest in Ireland’s history.

The public debt that increased from 57.3% GDP in 2019 to 63.7% GDP in 2020. In 2021, this is expected to decrease to 61.3% GDP. In 2022 it’s expected to touch 59.2% GDP.

Coming to inflation, in 2019 the country had moderate inflation of 0.9%. In 2020, this became a deflation with –0.2%. In 2021, the situation is expected to better with an inflation rate of 0.6%. In 2022, it’s expected to reach 1.2%. Moreover, the grants and loans from the EU Ireland are expected to get will be around 5% of its GDP. This will provide a good deal of relief and will help better the social and economic impact of the COVID-19 pandemic. It will also promote digital transactions.

The country’s budget for 2021, an added stimulus of 1.7% GDP has been allocated. The country’s economy is still very volatile owing to the weight of multinationals in the economy.

The National Statistics Office has presented data that reveals that Ireland’s unemployment rate had reduced to 4.7% in December 2019. But, due to COVID-19, it shot up to 7.2% in 2020. In 2021 an increase to 6.2% is expected. In 2022, it’s expected to be 5.9%.

Checking out the prominent sectors of the industry, agriculture is still the key sector of Ireland’s economy. That’s why the Government of Ireland is modernizing the food processing industries. This includes wheat, barley, potatoes, and barley. Agriculture represents 0.9% of Ireland’s GDP. It employs 4% of the country’s labor force.

There has been a recent surge in the development of industries in Ireland. The government of Ireland implemented a policy of promoting advanced export-oriented enterprises. The government has also given investors attractive offers. This sector that accounts for 35.2% of the country’s GDP employs 19% of its population actively at work. Among the industries in Ireland, electronics, chemicals, and textiles perform particularly well.

The services sector employs over 77% of the country’s labor force and accounts for close to 56.7% of the country’s GDP. There has been phenomenal development in the banking and finance sectors. The progress recorded has been so impressive that currently Dublin is an important financial center in the country.

Tourism is currently tourism is a significant source of earnings from foreign exchange. In 2020 tourism earned €9.2 billion for the country. The sector employed 265,000 people in 2020 as per the information released by the Irish Tourism Confederation.

In 2020, while the pharma & chemical, and technology firms stayed resilient, hospitality, retail, and travel sectors were greatly impacted by the pandemic. The Irish Tourism Confederation has revealed that as of November 2020, the largest number of people who received the Pandemic Unemployment Payment were those who worked in the accommodation and food-service sectors. There were 98,233 recipients of the payment.

The next highest number of people who received such payment was from the wholesale and retail trade with 51,921 people. The arts, entertainment, and recreation sectors followed with 11,400 people.

If you found this blog engaging, you may also like…

Economy and employment in Germany in 2021 – An overview