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Session 1 : Ireland’s Society in Economic Downturn Kieran Walsh Central Statistics Office.

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Presentation on theme: "Session 1 : Ireland’s Society in Economic Downturn Kieran Walsh Central Statistics Office."— Presentation transcript:

1 Session 1 : Ireland’s Society in Economic Downturn Kieran Walsh Central Statistics Office

2 Outline of series of talks  Overview of range of information available from CSO  Insight into impact of economic downturn  Stiglitz Report  Session 1: Effect on people  Session 2: Effect on business  Session 3: Overall effect on economy  Session 4: Alternative view of effect on economy  Session 5: Accessing CSO data

3 International context  Housing bubble in US in 2005/2006 (peak mid 2006)  Adjustable rate subprime mortgage defaults during 2007  Securities based on subprime mortgages crash  March 2008 emergency sale of Bear Stearns (sale value of $2 per share v $75 a week earlier)  Irish stock market lost €3.5bn value in one day  15 th September ‘08 Lehman Bros declare bankruptcy  September 29 th Irish banking guarantee

4 Irish context – overall economic decline

5 Irish context – overall economic decline contd.  GDP at constant market prices  2007 – €186.6bn  2008 – €180.0bn  2009 - €166.3bn  2010 – first 3 quarters €124.1bn (€165bn annualised approx)  Fall approx. 13% ‘07 to ‘10 (approx. +1% EU-27)  Approx. 21% drop on GNP  Reductions mainly up to Q3 2009

6 Session 1: Ireland’s society in economic downturn  Range of information available indicating impact on Ireland society  Employment and unemployment (QNHS)  Live Register  Income/Earnings (SILC/EHECS)  Prices  Other social indicators  Look at where we started and where we’ve moved to  Silver lining???????

7 Ireland – 2003 to 2007

8 2003 to 2007 contd. Up to 2007 continuous labour market and population growth driven by inward migration Natural growth would only have provided 20-25k per annum while employment growth was up to 90k per annum at points Peak employment level – Q307 at 2.15m – employment growth 4% to 5% per annum from 2004 to 2007 Construction effectively peaked in Q3 2006 but didn’t substantially fall until q4 2007 In years up to 2007 construction had regularly accounted for 20-25% of employment growth and up to half of male employment growth. Unemployment rate below 5% since 1999

9 2003 to 2007 contd. – International Comparison 2004200520062007 Employment Rates EU-2762.863.564.565.4 Germany65.066.067.569.4 France63.863.7 64.3 UK71.7 71.671.5 Ireland66.367.668.769.2 US71.271.572.071.8 Unemployment Rates EU-279.18.98.27.2 Germany9.810.79.88.4 France9.3 9.2 UK4.74.85.45.3 Ireland4.54.44.54.6 US5.55.14.6 While employment rates grew over the period – less than Germany and in line with EU average Unemployment rates flat while EU average fell

10 2003 to 2007 contd. – International Comparison 2004200520062007 Population (15-64) % annual growth EU-27 0.30.70.50.4 Germany -0.40.5-0.4-0.6 France 0.70.91.00.8 UK 0.70.80.70.6 Ireland 1.82.53.12.7 US 1.11.71.81.1 Employment (15-64) % annual growth EU-27 0.91.61.91.8 Germany -1.43.21.92.1 France 1.00.90.80.6 UK 0.40.7 1.6 Ireland 3.14.64.73.4 US 1.2 1.11.0 Ireland had far higher population growth over the period than other countries Employment growth among persons aged 15-64 more than twice the EU average over the period and significantly higher than all other countries

11 2003 to 2007 contd. – nature of employment growth By gender Male employment grew by 159,400 (+15%) Female employment grew by 153,400 (+20%) By age Of 313,000 total growth 121,000 (+24%) were 25-34 year olds with a further 120k aged 35-54 years old (+15%). No growth for 15-19 year olds and 22,000 for 20-24 year olds (+10%)

12 Sectoral employment growth, 2004 to 2007 By sector By sector contd Largest increase in construction (+64,000 or +32%) – mainly male Next largest wholesale and retail (+39,000 or +15%) and health (+36,400, +20%) – mainly female Increase greater than 10% for 10 of the 13 published sectors and overall increase of 13.5% (+252,000)

13 2000 to 2007 - Construction employment 20002004200520062007 Construction as a % of total employment EU-27 N/A8888 Germany 97777 France 78888 UK 67777 Ireland 101113 US 55566 Construction as a % of male employment EU-27 N/A13 14 Germany 13111011 France 1213 14 UK 11 12 Ireland 16192122

14 Unemployment, 2007 Unemployment rate approx. 4.5% (close to 5% for males and 4% for females) – relatively stable Just over 100k unemployed for which approx. one quarter long term (one year or more) Long term-unemployment higher among males than females – 30% v 20% Over long-term unemployment rate 1.3%

15 Ireland - up to 2010

16 Ireland – 2006 to 2010

17 2007 to end 2008 - Employment Annual labour market growth slowed from 4% in Q3 2007 to 0.6% in Q3 2008 at which point the labour market peaked at 2.27m (now 2.15m) Initially numbers employed fell relatively slowly with 2% drop (-43k) in year to Q3 2008. All of decrease male All reduction in full-time employment with slight increase in part-time Part time increasing in sectors where full time decreasing Over 80% or reduction accounted for by males in construction Male employment in industry falling also Wholesale and retail had initially grown up to Q1 2008 before falling at a slow rate Within construction reduction was in employees attached to housing (-27%) with non-housing construction still increasing (+10% approx) and self employed increasing marginally

18 End 2008 to date Employment fell by 140,000 or 6.7% between Q3 2008 and Q1 2009 combined (-5.3% when seasonal factors accounted for) Since Q1 2009 (up to Q3 2010) fall in employment has been 114,000 or 5.8% Over 2 years to Q3 2010 total drop 255,600 (-12.1%), approx. 75% male. Part time employment has increased over the period although flat since Q3 2009 Employment back at Q1 2004 levels – males back at Q1 2000 levels – females Q1 2006

19 Employment and unemployment contd.  Earliest sign of change  Q3 2006 – Construction employment peaked  While not falling until Q4 2007 within Construction employment shifted to more self employed and away from housing from Q3 2006 onwards  Housing accounted for close to 70% of Construction employment at peak and large majority were employees – less than 50% now

20 Sectoral employment 2008 to 2010 Q3 2008 to Q3 2009 – Decrease of 184,700 Q3 2009 to Q3 2010 – Decrease of 70,900

21 Sectoral employment contd.

22 Sectoral Employment 2010 Construction now at 6% (was 13%) – more than 50% of fall since Q307 Germany, UK, US all in 5 to 8% range (and generally at that level over longer term) Now 11% of male employment (13% EU average) Wholesale and retail and industry remain largest sectors Reductions in employment in 10 of the 13 sectors since 2007

23 Unemployment, 2007 and 2010

24 Unemployment, 2010 More than half unemployed males now long term unemployed Long-term unemployment rate 6.5% (late 1990’s levels) Long term-unemployment rising in particular from early 2009 with short- term falling since Q3 2009 (offset)

25 Profile of people unemployed in Q3 2010 By gender and duration Long term male unemployed now the largest group Female short-term a growing proportion

26 Employment and unemployment – focus on age

27

28 Greatest change among 15-24 year olds Were 16% of working people in 2007 Now 9% Narrowing of age range – now 76% of workers aged 25-54 (71% in 2007)

29 Employment and unemployment – focus on age – 15-24 year olds  Population has fallen (-14%, -90,000) – migration– most evident for 20-24 year olds  Marginal increase in number of students despite population drop (now 60% of total was under 50%)  Halving of numbers in employment and doubling of unemployed

30 Live Register  Not the same as unemployment but more up to date – similar trend

31 Live Register  Most recent live register information shows live register has been falling on a seasonally adjusted basis since July  January 2011 - 443,000 people signing on (467,000 peak in July/August 2010)  Standardised unemployment rate falling slowly (now 13.4%)  As with unemployment number signing on less than one year falling while long-term increasing

32 Income and prices

33 Income – SILC 2003 to 2009

34  In 2003 under €700 per week (€35,800 per annum)  Rose by an average of 7.5% per year to 2007 (€48,000 per annum)  In 2007 increase of 10% due to SSIA’s  Increased by just 2% in 2008  Fell by 6% in 2009  Decrease due to lower employment and less direct income  Social transfers still increasing (€287 per week in 2009 on average compared with €150 per week in 2003 – more recipients)  Lower disposable incomes and increased burden on the state  Employment and earnings of employees fell from 2009 to 2010

35 Prices – consumer price index

36 Prices - contd  Overall prices fell by 8.4% on average from September 2008 (peak) to January 2010  Wide range of price decreases including food, mortgage interest (interest rates), rents, electricity etc.  Annual inflation returned in August 2010 and running at 1.7% as of January 2011  Increases in mortgage interest and petrol prices

37 Income and prices contd.  As prices increase and income decreases deprivation increases  In 2009 5% of households in mortgage arrears  10% in arrears on utility bills  17% of households experienced 2 or more of a list of 11 types of deprivation, up from 12% in 2007  At end of September 2010 Central Bank estimates show 40,000 mortgages in arrears more than 90 days (€7.8bn in value – increased by 11.1% in 3 months)

38 Silver lining?????  Loss in employment stabilising (still falling but at slower rate and limited to certain sectors)  Live register has been falling over last 6 months at a slow rate  Vacancies higher in 2010 than in 2009  Exports performing well  Unemployment rate for people with third level honours degree approx. 7% (employment rate 82%)  Less than 6% of people with a third level education had suffered 2 or more forms of deprivation in 2009 (less than 1% in consistent poverty – state average 5.5%)

39 Nearly all available on www.cso.ie (along with much more)www.cso.ie Possible to access microdata for research purposes THANK YOU


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