Central Bank Quarterly Bulletin 3 2020

Guest post by Stephen Byrne, Central Bank of Ireland

Today the Bank published its third Quarterly Bulletin of the year. The report contains a detailed overview of developments in the economy since the publication of last Bulletin in early April as well as our latest macroeconomic forecasts out to 2022.

Given the scale of uncertainty surrounding the economic impact of Covid-19, two different scenarios for the economic outlook are outlined in the Bulletin (see featured image above).

In the “baseline” scenario, the economy reopens in line with the Government’s phased plan, allowing for a rebound in economic activity in the second half of the year. Some containment measures would remain in place meaning that activity would be constrained in some sectors for a longer period. Beyond the initial rebound, recovery is expected to be gradual, in line with a slow unwinding of precautionary behaviour as the effects of the shock on consumers and businesses lingers. The unemployment rate is set to decline from its second quarter peak of about 25 per cent as the year progresses and is projected be around half that level by the end of this year, before averaging just over 9 per cent next year and 7 per cent in 2022.

The baseline scenario sees output recovering to its pre-crisis level by 2022. However, the level of activity will be significantly below where it would have been had the economy grown in line with expectations before the outbreak of the pandemic.

In the “severe” scenario, the strict lockdown period is assumed to have a more damaging impact on economic activity and is not successful in effectively containing the virus. Stringent containment measures would remain in place, or would be re-instated, albeit not as severe as before, based on an assumption that there would be a resurgence of the virus at some point over the next year. In this scenario, there is a subdued economic recovery with a larger permanent loss of output. Unemployment remains higher for longer in this scenario and would average just below 17 per cent in 2020, while consumer spending is projected to fall by around 14 per cent and GDP by over 13 per cent this year. In this scenario, the projected recovery in growth in 2021 and 2022 would not offset the loss of output this year, leaving the level of GDP in 2022 about 5 per cent below its pre-crisis level.

Both of these scenarios assume that a Free trade agreement in goods between the UK and the EU, with no tariffs and quotas on goods, takes effect in January 2021. If such an agreement is not reached, then the EU and the UK would move to trading on WTO terms from January 2021. Box D of the Bulletin discusses the implications of such an outcome.

The bulletin also contains analysis of the impact of Covid-19 on debt dynamics and sustainability, as well as a detailed examination of the regional labour market impacts of the pandemic.

Finally, an accompanying signed article explores alternative long-term recovery paths for the economy and assesses the impact of fiscal and monetary policy supports. The Article considers how hysteresis – or scarring ­­– effects could influence the pace and nature of the recovery. The paper shows that, as a highly open economy, Ireland benefits from the positive effects of monetary and fiscal policy measures implemented abroad. The assessment of the combined effects of domestic and international policy supports indicates that the actions will help to meaningfully reduce the scale of the output loss in Ireland from the pandemic.

IGEES Job Opportunities

The Irish Government Economic and Evaluation Service (IGEES) is hiring graduate economists / evaluators.

Details on the Public Appointments Service website:  https://www.publicjobs.ie/publicjobs/campaignAdvert/61531.htm

Economist Role at Dublin Chamber

From the Chamber’s Aebhric McGibney:

Job Title:                     Economist

Reporting to:               Director of Public & International Affairs

Company:                    Dublin Chamber

Location:                     7 Clare St. Dublin 2

Role

Dublin Chamber is recruiting an Economist to work as part of the Chamber’s dedicated policy team.

The Economist will be responsible for the development and dissemination of accurate, timely reports and analyses.

Key Activities/Responsibilities

  • Research and policy development.
  • Prepare economic research and policy positions on issues of relevance to the Dublin business community.
  • Analyse and disseminate information on Dublin and the Irish economy.
  • Analyse public policy developments for their impact on Dublin and on business.
  • Draft key policy documents and reports.
  • Contribute to the research agenda of the department, including servicing policy taskforces.
  • Prepare member-driven submissions to Government and contribute to Dublin Chamber’s work on policy briefs which enhance its reputation as a thought-leader on policy research.

Competencies & Qualifications

  • Honours degree in economics or closely related discipline. A relevant post graduate qualification is an advantage.
  • Thorough understanding of economic theory and policy, and current economic issues.
  • Familiarity with economic data sources and other information.
  • Excellent numerical analysis and report writing skills.
  • Strong interpersonal skills.
  • Ability to communicate succinctly and utilise a range of communication methods as appropriate.
  • Excellent organisational skills.
  • Ability to work under pressure and to tight deadlines
  • Strong IT skills
  • Ability to work in team environment

This challenging and rewarding role requires building close professional relationship with senior leaders in business, research institutions and the public sector.

The ideal candidate will have 5 year’s relevant experience. This is a full time permanent contract, with salary commensurate with experience. Applicants should send a CV and cover letter to aebhric@dublinchamber.ie by 5pm Friday 28th July.

Director of the Parliamentary Budget Office Houses of the Oireachtas

This is a very important job, directing something many people including me have called for for years. The particulars for the role are here. The PBO will be a key part of the new budgetary framework for the state and the Director role is obviously vital to achieving sound fiscal policy. You can apply for the job here.

From the ad:

The Houses of the Oireachtas Service is the independent civil service agency which supports the running of both Houses of the Oireachtas (Dáil and Seanad Éireann) and provides administrative services on behalf of the Houses of the Oireachtas Commission.

The establishment of the Parliamentary Budget Office (PBO) is a key strategic priority for the Oireachtas in the context of the current Parliamentary Reform Agenda.

The Director will drive the establishment and shape the role of the PBO in consultation with members and other stakeholders. S/he will develop and manage the service capacity of the PBO, will set the strategic vision, provide leadership and deliver objectives.

The successful candidate will have:
• an understanding of fiscal governance requirements and the Irish budgetary process, including key constraints on budgetary policy which applies to general government revenue and expenditure;
• the ability to set the strategic direction and vision for the work of the Parliamentary Budget Office, having regard to the external environment, including the international, EU, and broader public policy and political context;
• a proven track record of significant achievement at a senior level that demonstrates leadership, management and interpersonal skills required for this role.

Statistician Positions at CSO

The CSO is recruiting for permanent Statistician posts, details below:

http://www.cso.ie/en/aboutus/recruitment/