Wage rises slow down below rest of the EU

Wage rises slow down below rest of the EU

The pace of wage growth in Ireland slowed dramatically to 2.2pc between January and March, under-performing the eurozone average for the first time since early 2017.

Meanwhile, the level of job vacancies here was the third lowest in the currency bloc, indicating the economy may not be overheating.

The data released by European Statistics agency Eurostat showed wage gains here have fallen off dramatically since the final quarter of last year when they came in at 3.2pc. This was seen as a sign the economy was getting close to full employment.

In the first quarter of this year, wages in the eurozone as a whole rose by 2.5pc, a 10-year high.

“The country breakdown shows much of the increase in wage inflation was in the economies which have been struggling for the past year or so,” consultancy Capital Economics said.

Momentum

“In practice, we think labour cost growth is more likely to be stable in the coming quarters, given the loss of momentum in the economy and the evidence from business surveys that the labour market is no longer tightening.”

A separate release from Eurostat showed job vacancy rates here stood at 1pc, well below the 3pc average in the euro area, another measure suggesting demand for labour looks to be slowing.

The economy here is expected to grow by around 4pc this year, unless there is a hard Brexit, down from 6.7pc in 2018.

Over the course of 2018, some 63,000 jobs were created on a net basis and the Department of Finance is expecting 50,000 new jobs will be created this year.

There are still skills shortages in healthcare, finance and engineering, according to a new study by the Central Bank of Ireland and jobs website Indeed.ie.

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