Employment Gains and Losses by Sector

The National Accounts suggest that the activity peak was about Q2 2007, so the last reading on pre-recession employment was about Q1 2007. The QNHS published yesterday gives Q1 data for 2007, 2008 and 2009 on the new basis. Figs in 000 are from the sa Table 3.

Sector                    Q1 07      Q1 08     Q1 09     % Chg 09/07

Agriculture              108.9       116.9     102.7           -5.7

Industry                 305.3       288.1     268.6          -12.0

Construction           270.7      256.6      184.0           -32.0

‘Public Sector’         453.2      463.7      480.7            +6.1

All Other                963.1     1013.6      945.3            -1.8

Tot Employment     2101.2    2138.9     1981.3            -5.3  

Unemployed             98.5       109.9     223.4          +126.8

Labour Force         2199.7     2247.6    2203.0            +0.2

‘Public Sector’ is the sum of NACE categories O, P, Q, Public Administration, Education and Health, and includes over 100K not formally public servants. Some commercial Semi State employees are in Industry. The most dramatic collapse is in Construction, down 32%, with Industry down 12%. The OPQ ‘Public Sector’ has grown 6%,  and is the only sector exempted from the downturn thus far. The quarterly peak was actually in Q4 08 and there are now recruitment curbs and budget cuts, so this sector may turn negative through 2009. But to date, the OPQ sector has added 27,500 since the downturn started (+6.1%) while the rest of the economy has shed 147,400 (-8.9%).

The propagation of the employment contraction out of construction in 07 into the rest of the private economy in 08 is clear. The QNHS unemployment rate grew from 4.5% to just 4.9% through 07, but soared to 10.2% in the four quarters to Q1 09. Since the most sharply-contracting sector has a mainly male workforce, an interesting effect is that 45.1% of the employed workforce is now female, an all-time record. Labour force growth has ceased and the participation rate has been dropping steadily for a year. In total employment terms, the fastest decline was in the most recent quarter, and with probably not a single sector now expanding, the Q2 figures will hardly bring much joy.

22 thoughts on “Employment Gains and Losses by Sector”

  1. It would be a great service to the public discourse if public sector increases/decreases for the past number of years were to be examined by category instead of just all lumped in together (for example, the Guards will reach a record strength of 15,000 members by the end of this year, while the regular defence forces have decreased as a result of PwC).

    I’m under no illusions that the right-wing commentariat which passes for the great majority of same public discourse in this country will do anything other than ignore such detail, but ordinary readers would undoubtedly benefit (if it can be done for the minutae of macroeconomics, then why not here as well?).

  2. And, by the way, I would be interested to learn whether the quarterly peak for public sector ‘recruitment’ was the result of new hiring or else public servants on sabbatical returning to their public employment.

  3. These data raise the interesting question of what proportion of households (and in what stages of the family life cycle) are now dependent on a female wage – perhaps indeed one that is earned in the public sector (as defined here).

  4. EWI: Fresh data on the breakdown you desire will be out on Monday from CSO, the March 09 Public Sector Employment and Earnings series, but the definition of ’employment’ is different from the household-based QNHS. You are right that some sub-sectors in the public service have been static or declining, but the aggregate was rising until Q4 08 however measured. There was a dip in the sa QNHS to Q1 09 and recruitment curbs have been extended. It’s a fair guess that the rise in the aggregate is over at this stage, but the diverging trends for employment in the public and private sectors through 2007 and 2008 are stark notwithstanding the definitional issues, which have been discussed on this blog before. The OPQ sectors in the QNHS grew from 21.6% of employment in Q1 07 to 24.3% in Q1 09, reflecting (i) the fiscal correction did not start until July 2008 and (ii) the weakest sectors, construction and industry, had no (or very few) public servants to begin with.

    On a brighter note, employment in the commentariat (both wings) seems to be rising, no figs unfortunately.

  5. Another important question: How many out of that massive drop in construction employment are currently munching kielbasas on the banks of the Vistula?

  6. The emigration figures are also notable, and were entirely focussed on accession workers. ‘Accession emigration’ was 25,000, though the overall workforce kept growing. For every 1 accession worker who joined the dole, almost 2 emigrated.

  7. To confirm what Ronnie said. The QNHS Report gives some clues as to migration trends in the past year. It looks at though there was net emigration of about 20,000 among foreign nationals in the year to 2009 Q1, which is much less than the 100,000 the IBEC economist, Danny McCoy, claimed recently for the outflow of foreign nationals in 2008. This comprised a net outflow of about 25,000 among accession state nationals, and a net inflow of about 5,000 among other foreign nationals. So, of every 24 foreign nationals here in 2008 Q1, 23 were still here in 2009 Q1.
    Their numbers here have fallen from 480k to 460k approximately in the past year. Although no figures by individual countries are given in the QNHS Report, I’d guess the number of Polish nationals fell by more than that, but the number of non-Polish nationals most likely rose in the year to 2009 Q1.

    The figures also indicate something that has received little attention, either fom economists or the media. Namely, there seems to have been a net inflow of Irish nationals in the year to 2009 Q1. The number of Irish nationals increased in that period by 33,000, which is much greater than one would expect from natural increase (deaths of those aged 15+ minus new entrants to that age group from those aged 14 in 2008 Q1). Far from a mass exodus of Irish nationals emigrating to London and New York (as David McWilliams claimed recently), it looks as though there was a substantial net inflow to Ireland of returning emigrants, more or less cancelling out the 20,000 net outflow of foreign nationals.

    I don’t find this surprising. Unemployment has risen everywhere. When unemployment rises everywhere, a factor influencing migration trends is the level of unemployment benefit. This is now much higher in Ireland than in the UK or US. If an Irish national is going to be unemployed, he or she would be much better off unemployed in Ireland than in the UK or US right now. Those who make simplistic comparisons with the 1980s should bear that in mind. Back then, unemployment benefit was much lower in Ireland than in the UK, hence it paid the unemployed here to emigrate to the UK, even if they remained unemployed there. The reverse is true now.

    Taking the QNHS figures in conjunction with recent birth rate figures, its clear that the total population is still growing strongly, although not by as much as in recent years.

  8. @Colm, EWI:
    The Report of the Public Services Benchmarking Body (December 2007) (http://www.benchmarking.gov.ie/reports) contains data on the trends in public service employment.

    The percentage increases 2001-2007 by sub-sector were (full-time equivalents) were:

    Health +31.9
    Education +26.4
    Civil Service – +9.2
    Non-commercial state bodies +15.6
    Local authorities +18.8

    @John:
    It is interesting to break down the population changes by nationality by labour force status: (thousands)

    Irish nationals:

    In employment -102.8
    Unemployed +83.3
    Not in the labour force +48.1
    Total: +32.6

    Non-Irish-nationals:

    In employment -55.7
    Unemployed +26.0
    Not in the labour force +8.8
    Total: -20.8

  9. @Professor Walsh

    As the leading expert on Ireland’s demographics (i.e. you, not me), while I’m a mere amateur, would you agree with my tentative conclusions that,
    based on yesterday’s QNHS figures:

    (a) There was a small net emigration (possibly around 10,000) in the year to 2009 Q1, but only a fraction of some of the estimates bandied about in the media – for example, there was a series of newspaper articles last autumn (by Brendan Keenan, among others) claiming that there had been net emigration of 100,000 in 2008. Simply not borne out by these figures.

    (b) This small net emigration resulted entirely from foreign nationals going home, but even this modest flow was far smaller than media reports along the lines of ‘all the foreigners are leaving’ would indicate – between 2008 Q1 and 2009 Q1, the foreign nationals population fell by just 4% (from 480,000 to 460,000).

    (c) In the year to 2009 Q1, there was probably a modest net inflow of Irish nationals – I’m not totally certain here, as data is lacking – but, based on the number of births in 1994 (which you published here recently), there can only have been around 48,000 to 52,000-53,000 Irish nationals aged 14 in 2008 Q1 and around 28,000 deaths of Irish nationals aged 15+ in 2008, leaving the natural increase of the Irish nationals population in the year to 2009 Q1 at around 20,000 to 24,000-25,000 – yet the number of Irish nationals increased by 32,600 in the year to April 2009 Q1.

    I’m not sure if this analysis of mine could be rendered nonsense, if there was any significant number of foreign nationals changing their nationality to Irish – I simply don’t know if this happens to any extent. It wouldn’t affect the overall migration flow that I gave in (a), but it would render as nonsense the points I made in (b) and (c) about the breakdown by nationality of the migration flows.

  10. Brendan, the implication being that, not surprisingly, dis-employed non-national workers have left to a greater degree than have dis-employed Irish workers (thus far). But what happens next, if, as I think is likely, total employment shrinks for another few quarters? If the international economy has bottomed, emigration could pick up quickly, and I wonder if John above is right that population will continue to rise over the next couple of years. The labour force is falling already.

  11. @colm

    I’m not aware that I said the population will continue to rise over the next couple of years. Having just reread my posts, I can’t see where I predicted that. My grammar and wording might not have been the best well into the evening, and after a long day’s work, but I don’t think I actually made any predictions about the future in my posts. In general, I tend not to go in for predicting the future (that should be left to Mystic Meg), but try to concentrate on analysing published data for the recent past.

    I did say: ” its clear that the total population is still growing strongly”

    Maybe, I should have said ‘was’ instead of ‘is’, as the figures I was referring to were the QNHS figures up to 2009 Q1. That is now 3 months ago, so what has happened since then I have no idea. But, in the year up to 2009 Q1, the population certainly rose, although not by as much as in recent years.

    Regarding the future trend in population growth, as I say, I don’t go in for predictions, but I would make a number of points that need to be taken into account by those who do – without repeating my previous posts, these would be:

    (a) Unemployment benefit in Ireland is now much higher than in the UK or US – which is a major difference with the 1980s, and may well affect the migration of the unemployed.

    (b) The birth rate has risen sharply in recent years (as Prof Walsh pointed out here last week) and, to little media attention, the death rate has fallen dramatically in recent years (again, Prof Walsh is the only one who appears to have studied this phenomenon – I think I read a paper by him on the internet a year or two ago on the matter) – anyway, the net effect is that the excess of births over deaths in Ireland has now reached an unprecedented 46,000 to 48,000 a year, which is many times per capita that in any other EU country. Therefore, annual net emigration would have to reach close to the 1950s level of about 50,000 a year for the population to actually fall. I’m not saying this is impossible, I’m just pointing out how high net emigration would have to go to before the population would start to fall. Of course, the birth rate could fall in the next few years. I simply don’t know.

    (c) Although the unemployment rate in Ireland is now slightly above the EU average and slightly higher than in the US, the employment rate in Ireland is still higher. In the US, it has been estimated that, if unemployment was calculated on the same basis as in Ireland, it would now be 15%. In the UK, under Thatcher and her successors, the system became expert at disguising unemployment by putting huge numbers on invalidity benefit. This happened here too, but not to same extent. A good comparison is between Rep. Ireland and N. Ireland. The official unemployment rate in the Republic is now going on for twice that in N. Ireland. But, the employment rate in the Republic is still higher. The explanation is the much greater number on invalidity and similar benefits in N. Ireland. And many continental countries have staggeringly low employment rates, much lower than in Ireland, while not having particularily high official unemployment rates. Again, the explanation lies in measures they’ve adopted over the years to disguise unemployment (for example: ridiculously early retirement, large numbers on invalidity and high numbers working only part-time – in the Netherlands, I think this group are over 40% of those at work, 2 or 3 times what it is in Ireland).

    As I say, none of these are predictions, but simply points that need to be taken into account when making predictions. The bottom line is that, at least until 2009 Q1 as the QNHS figures on Thursday show, and contrary to numerous forecasts by all and sundry, there was actually continuing net immigration among Irish nationals. In particular, an article by David McWilliams in the Irish Independent on 20 August 2008 can now be seen as complete hogwash. In it, based on his supposed analysis of GAA transfers listed on the GAA website, he claimed that mass emigration of Irish nationals (as distinct from foreign nationals going home) had begun in early 2008 and, by the time of his article in August 2008, was allready running at 1980s levels. The QNHS figures on Thursday show this to be complete nonsense. His article is well worth a read. If read alongside Thursday’s QNHS report, it will provide an insight into the meaning of the word ‘charlatan’.

  12. @John

    The latest QNHS shows the population aged 15 and over stabilizing at a little over 3.5 million over the last two quarters. However, the number of births continued to rise during 2008, so the total population in 2009 may well be above the 2008 figure. But it is reasonable to expect now that net emigration will increase sharply and the number of births begin to fall. So perhaps the high point for the population of the Republic will be reached this year – just short of 4.5 million?

    The Irish Independent’s coverage of the QNHS was fair enough, saying that there are signs that emigration has started amongst foreigners, but not amongst Irish.

    On a micro level, the Indo discussed the impact of the recession of Donegal’s football team in measured terms (3 June):
    “[They] currently find 10 of their squad out of work, but this only seems to add to their mystique. If Gaelic football followers did ‘second teams’, Donegal’s results might be the ones they would go looking for.
    “That has hit everywhere but it’s probably particularly relevant up here,” Cassidy continues. “People say the Celtic Tiger never hit Donegal. It’s very difficult for the lads. They want to hang around because there is championship to be played but there are mortgages to be paid. I’d say next year you might see a few of them move away.”

  13. Bizarrely, The unemployment rate is only slowly climbing in Australia. In April, it actually fell. But these are official stats so…..)

    NZ is a basket case and their emigrants to Oz do not qualify for social welfare in Oz. But still they come and there are no barriers to NZ citizens into Oz or vice versa. NZ is actually a back door to Oz, therefore and had different criteria for immigration from Eu etc. (Just in case you were interested!)

    Oz has reduced skilled migration quota figures recently but they were the largest ever, so there is still some room left here! We have a continent to fill.
    The objectives are 25-50 million (!) by 2050 and stable thereafter, from a likely 22m next year. Brisbane is expecting 100,000 pop increase for the next few years, most by internal migration from the ageing and wintry south. More suburbs are being developed accordingly. What Depression?

  14. John, sorry if I took you up as expecting the pop increase to continue – it all depends on the migration change as you say, since natural increase tends to evolve much more slowly. Net migration has shifted very quickly in Ireland during previous macro corrections, we shall see.

    On GAA teams, during the out-migration in the 1980s, I noted that bad teams were differentially affected, explaining that ‘…all the lads are over in Boston’. Players on good teams somehow escaped the downturn.

  15. Am I missing something here or is everyone comenting here dyslexic ? The figures posted show a 8.9% reduction in all other employment overall in the period and a 6.1% increase for the Public Sector. As one of those in the Private Sector really suffering and experiencing the recession I am disgusted that this Government continues to think that we are going to continue to pay for this incompetence. To make matters worse these people employed in the Public Sector are costing the State more with their incremental salary scales. It is not Snips we need but wholesale cuts in numbers and salaries in the Public Sector if ever the Deficit is to be eradicated.

  16. Re the last post:

    (1) There is no law that says the number employed in the public sector must be a fixed proportion of the number in total employment. If there was, there’d be more employed in the public sector, because between 1990 and 2007 the number in total employment rose far more than the number employed in the public sector.

    (2) The recent OECD report highlighted the fact that the number employed in the public sector in Ireland is much lower than in most other western European countries.

    (3) The increase in unemployment in Ireland is not due to any tax burden on the private sector resulting from a large public sector. Employers’ PRSI and Coporation Tax in Ireland are among the lowest in the world. Neither is it due to exports losing market share or imports gaining market share. As recent CSO figures show, exports are doing spectacularily well in comparison with other EU countries, up 3% in value in Jan to April, compared with 25% falls in most other EU countries. While imports have collapsed, down 30% from 2007 in recent months. The trade surplus is in the stratosphere, and we’re heading for a massive balance-of-payments surplus.

    (4) The increase in unemployment is due to a collapse in demand in Ireland. One of the causes is that, uniquely in the EU, wages are being slashed. Sacking 50,000 public sector employees, as some want, would make it worse. They’d have no income to spend.

    The attitude of private sector employers in Ireland is almost comical. They demand public sector wages be cut, they demand private sector wages be cut, they demand massive reductions in the number employed in the public sector (eve though this is lower than in comparable countries), they demand that social welfare benefits be slashed. Then, they whine that sales in shops, pubs, restaurants, car showrooms et al are down. Of course they are, if nobody has any money, how can they spend?

  17. @John
    I chuckled after reading your post in response to mine. I assume that you work somewhere in the Public Sector. Clearly you do not understand basic arithmetic that when a Government proceeds to spend more than it brings in in revenue to the tune of Euro 20 Billion pa that something has to give but not according to our Government based on Colm’s post. You appear to think that wages is a fixed cost when it is a variable cost. The economy is contracting this year at a rate of 10% and you do not need to be a brain surgeon to realise that all of Government costs have to be cut to match revenues but seemingly not here. Wait for the money to run out from the International Financiers and then see how many are left working in the Public Sector.

  18. Another interesting snippet that I noticed this time (having missed it last quarter) is that there are more women in permanent employment than men (the self-employed sector is largely men). Is this a record?

  19. I am only seeing these statistics now.

    I am convinced that there is something disfunctional about our Private Sector Labour Market. It is cratering jobs, and without young people trying to get work in other countries, it would be much, much worse.

    I would be fascinating to get the same statistics at this point in time. Or even in Q1, 2011.

    It would also be interesting to get a break down on part time work, temporary work, or unemployed people involved in temporary schemes.

    And it would be interesting to get the total of people in education and training schemes of one form or another.

    We must also ask questions about the minimum wage in the context of people leaving this country to work in countries with a lower minimum wage.

    And we must ask questions about the low tax levels on entry level workers when young people are leaving the country to work in economies where the tax levels are higher at the same wage levels.

    In effect, people are behaving as if to circumvent the Irish private sector labour market.

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