Session 1 : Ireland’s Society in Economic Downturn Kieran Walsh Central Statistics Office
Dec 21, 2015
Session 1 : Ireland’s Society in Economic Downturn
Kieran WalshCentral Statistics Office
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
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
15th September ‘08 Lehman Bros declare bankruptcy
September 29th Irish banking guarantee
Irish context – overall economic decline
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
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???????
Ireland – 2003 to 2007
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
2003 to 2007 contd. – International Comparison
2004 2005 2006 2007
Employment Rates
EU-27 62.8 63.5 64.5 65.4
Germany 65.0 66.0 67.5 69.4
France 63.8 63.7 63.7 64.3
UK 71.7 71.7 71.6 71.5
Ireland 66.3 67.6 68.7 69.2
US 71.2 71.5 72.0 71.8
Unemployment Rates
EU-27 9.1 8.9 8.2 7.2
Germany 9.8 10.7 9.8 8.4
France 9.3 9.3 9.3 9.2
UK 4.7 4.8 5.4 5.3
Ireland 4.5 4.4 4.5 4.6
US 5.5 5.1 4.6 4.6
While employment rates grew over the period – less than Germany and in line with EU average
Unemployment rates flat while EU average fell
2003 to 2007 contd. – International Comparison
2004 2005 2006 2007
Population (15-64) % annual growth
EU-27 0.3 0.7 0.5 0.4
Germany -0.4 0.5 -0.4 -0.6
France 0.7 0.9 1.0 0.8
UK 0.7 0.8 0.7 0.6
Ireland 1.8 2.5 3.1 2.7
US 1.1 1.7 1.8 1.1
Employment (15-64) % annual growth
EU-27 0.9 1.6 1.9 1.8
Germany -1.4 3.2 1.9 2.1
France 1.0 0.9 0.8 0.6
UK 0.4 0.7 0.7 1.6
Ireland 3.1 4.6 4.7 3.4
US 1.2 1.2 1.1 1.0
Ireland had far higher population growth over the period than other countriesEmployment growth among persons aged 15-64 more than twice the EU average over the period and significantly higher than all other countries
2003 to 2007 contd. – nature of employment growth
By genderMale employment grew by 159,400 (+15%)
Female employment grew by 153,400 (+20%)
By ageOf 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%)
Sectoral employment growth, 2004 to 2007
By sectorBy 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)
2000 to 2007 - Construction employment
2000 2004 2005 2006 2007
Construction as a % of total employment
EU-27 N/A 8 8 8 8Germany 9 7 7 7 7France 7 8 8 8 8UK 6 7 7 7 7Ireland 10 11 13 13 13US 5 5 5 6 6Construction as a % of male employment
EU-27 N/A 13 13 13 14Germany 13 11 10 11 11France 12 13 13 13 14UK 11 11 11 12 12Ireland 16 19 21 22 22
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%
Ireland - up to 2010
Ireland – 2006 to 2010
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 maleAll reduction in full-time employment with slight increase in part-time
Part time increasing in sectors where full time decreasingOver 80% or reduction accounted for by males in constructionMale employment in industry falling alsoWholesale and retail had initially grown up to Q1 2008 before falling at a slow rateWithin construction reduction was in employees attached to housing (-27%) with non-housing construction still increasing (+10% approx) and self employed increasing marginally
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 2009Employment back at Q1 2004 levels – males back at Q1 2000 levels – females Q1 2006
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
Sectoral employment 2008 to 2010
Q3 2008 to Q3 2009 – Decrease of 184,700
Q3 2009 to Q3 2010 – Decrease of 70,900
Sectoral employment contd.
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
Unemployment, 2007 and 2010
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)
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
Employment and unemployment – focus on age
Employment and unemployment – focus on age
Employment and unemployment – focus on age
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)
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
Live Register
Not the same as unemployment but more up to date – similar trend
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
Income and prices
Income – SILC 2003 to 2009
Income – SILC 2003 to 2009
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
Prices – consumer price index
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
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)
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%)
Nearly all available on www.cso.ie (along with much more)
Possible to access microdata for research purposes
THANK YOU