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THE IRISH ECONOMY looks set to grow significantly despite major external pressures, a new report from the Economic and Social Research Institute (ESRI) has found.
It is estimated that Irish GDP will grow by 6.8% in 2022, with the equivalent measure rising by 4.8% next year.
The demand for goods and services is set to increase by a slower pace than previously expected.
The ESRI said it now expects growth of 4.4% in the present year and 3.7% in 2023, compared to 5% and 4.5% in the previous commentary.
“In light of the ongoing war in Ukraine, inflation is set to increase further as the conflict disrupts food and energy markets. As a consequence of increasing price pressures, we now forecast inflation to average 7.1% in 2022,” the report states.
As well as increased economic growth, the ESRI believes that the unemployment rate nationwide will continue to fall to around 4.3% by the end of the year. This trend is expected to continue and the estimation is that just 4% of people will be out of work by the end of 2023.
Commenting on the report, author Kieran McQuinn of the ESRI said: “We still expect the domestic economy to grow strongly in 2022 and 2023. However, there are significant downside risks to the growth outlook with greater inflationary pressures being the most pressing”.
Conor O’Toole of the ESRI added: “The economy has recovered from the pandemic in a robust fashion, with the labour market recovering particularly strongly. The challenge for policymakers now will be to respond to higher inflation against a backdrop of tight labour markets and rising interest rates.”
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While the Irish GDP might make the country look good, it is not good for the people who have to pay crippling rents and higher prices on bills.
@Dean: Higher prices have nothing to do with increased GDP.
GDP is irrelevant to the Irish people. Being the highest costing country in the EU is much more relevant.
@Irish Opinion: Try moving to South Sudan or Somalia and say that GDP is irrelevant to the people.
Honestly, that is an enormously uninformed comment.
@Lee King Buckett: Every single person that reads his comment will know exactly what he means and will agree because not everyone is an economist! But as usual, you’re straight in with a level of condescension that is second to none in these comments! The average person in this country couldn’t give a monkeys about GDP because they are living in the most expensive country in Europe! An country where the multinationals pay sweet FA in tax while the average Joe Soap is getting taxed into oblivion! But look, over here.. our GDP is great! Pff get a grip FFS!!!
@Stuart Birney: You seem to have a bit of an owie there man – u OK hun?
You don’t have to be an economist to know that the growth of a countrys’ economy is massively important to the standard of living.
With attitudes like yours, its no wonder that populism is rife these days, all you have to do is come out and make a dumb statement and as long as you can rouse the masses, what does it matter if its correct or total codswallop.
@Lee King Buckett: Ah, there it is again..as expected! You are absolutely unbelievable! Without a doubt the most arrogant and obnoxious troll on the Journal! Do you feel like a big man atop your ivory tower when you spew your condescension down on all of us normal people, huh? I bet you do!
A dumb statement you say! You mean like comparing Ireland to a couple of the poorest countries on the planet in order to further insult his intelligence and prove your ridiculous point? Yeah, good man yourself.
Hmm, an owie? Erm.. No, I don’t because I’m not 3 years old thanks very much!
And U OK hun? Seriously.. 2016 called, even they don’t want that BS back.
Either grow up or cop on because you’re not impressing anyone here!!
Will we invest this success in people or corporations? Will greed be the renewed mantra, and individual excess wealth be at the cost of the majorities well being ?
@Niall: Yes!
@Niall: You should consider becoming a politician as you clearly have a skill fire hollow rhetoric
@Niall: only for the multinationals our economy wouldn’t be ask big as it is.
start taxing them to the hilt and they will leave this county.
Very surprised inflation only 7% I’m paying more for products that cost significantly less 2 months ago
@Great White Hope: That’s not quite how CPI inflation works. Its a weighted average of inflation across 1,000s of items. Some will be substantially higher than 7%, some will be much lower.
What individuals spend their money on day to day will differ and so everyone will experience differing levels of inflation.
How about GNP.. I bet this will fall and we will be in recession… Using GDP to say all is rosy in the garden is akin to ‘Leprechaun Economics’ which does not reflect the real economy.. About time The Journal fact checks the figures
Capitalism at its finest
@Susan Keane: in fairness do you want socialism?
that is doing wonders in certain counties in South America
capitalism has its faults but its far better than socialism.
@Alan Richard Scott Jr.: have you not heard of the Nordic countries? They are doing very well with socialism
@Dave Harris: not real socialism.
@Dave Harris: and Sweden in particular pay more tax for their generous welfare and free healthcare system. And their GDP only grew 2.1 %
low tax society is the way to go.
@Alan Richard Scott Jr.: are you saying ireland is low tax ? Over half my pay goes every paycheck. Get feck all for it
@Alan Richard Scott Jr.: If both systems were run for the benefit of the people without corruption both systems would work tine.
@Alan Richard Scott Jr.:Ireland is a low tax society and you compare Ireland favorably to Sweden..back to bed for yourself
@Gert McNulty: “are you saying” is the key word
Never once did I mention Ireland was low tax.
@Alan Richard Scott Jr.: Sweden’s average local tax rate is 32.34 per cent. Earners above a certain income threshold set by the Tax Agency also pay 20 per cent state tax. The Swedish tax system includes a so-called basic deduction, a sum that is exempt from the taxable income. Ireland’s tax rate is the same as this when you add in USC and PRSI for anyone earning over 70k and then add all the stealth taxes and levies. Coupled with the fact everyone who pays tax in Sweden benefits from excellent health care, education, transport, piped hot water etc. In Ireland the more tax you pay the less you get. In fact anyone paying the higher rate of tax gets nothing.
@Dave Harris: and the myth that the Nordic countries are socialist is always used by the left wing “socialism is the social ownership of the means of production. Capitalism is the private ownership of the means of Production which operate for profit”
Sweden for example economic system is private ownership with a public sector. So your utterly and completely wrong.
the Nordic counties are capitalist even more so than the United States.
You clearly don’t have a clue mate.
Socialism is Marxist ideology
I would love to hear the explanation of why a barrel of oil cost more in 2014 and petrol prices were €1.20. Also the price of oil is dropping, price at pump has increased 20% in past fortnight. Is it possible we are being screwed and our useless Government is taking no action? Surely not!
@Gerard Carthy: and this 7% inflation doesn’t include petrol and diesel which are still ludicrously considered a luxury in this country. Inflation for the ordinary person in reality is probably nearer 20% to 25% between the massive rises in fuel, power, food and consumer goods
@Michael McGrath: spot on don’t know where this lot get their figures. They obviously don’t live in the real world.
@Michael McGrath: CPI inflation figure of 7% does include petrol and diesel, its in the transport heading.
The CPI is a weighted average so whilst petrol may be up more than 7%, food may be up by only 2% for arguments sake,.
All figures are thrown into the mix and then the average headline figure is arrived at according to how much of each pay packet the average person pays on which things. If more is spent on food than petrol then food has a higher weighting.
It’s an average figure, not a personalised one, everyone’s circumstances will be different.
@Gerard Carthy: Corporate profits are up but also, inflation over time plays into the cost of refining, transporting and distributing. So the relative increase vs 2014 is a mixture of profiteering and inflationary costs.
@Lee King Buckett: Refining is part of the product price. Transportation, distribution etc are around 3%. Tax is 50%. So for example the recent increases, from 1.50 to 2.20, half is the government. They could for example fozen their take, still taken in the same amount as pre price spike, and kept the price around 1.80. Same is true of gas and electricity, for different reasons, but the price hikes are essential artificial.
@Gerard Carthy: Diesel and petrol refinement costs are not reflected in crude oil prices.
@Lee King Buckett: Yes, but crude dictates wholesale price, and refining is in this, the product price. Oil companies profits are in windfall territory. It’s not because people are suddenly buying more petrol. It’s because their margins are excessive. Since t(eir margins and tax track each other, the increases are not based on the spike in oil prices, but profiteering and increased tax because it’s a percentage of increased wholesale prices. Half of recent increases are completely unjustifiable exchequer windfalls at our expense.
Can’t win. If the figures showed a fall in output the same people would be on here moaning about it.
Funny old world.
@Justin Gillespie: Are you not equally moaning about the moaners?
@Justin Gillespie: well said Justin, never seen such a bunch of ungrateful pessimists. Go travel and see how the rest of the world is doing. Believe it or not, were punching well above average
@David Fitzpatrick: Have you traveled to every other country to find that out?
@David Corrigan: There’s this great new innovation called the internet which allows us all to see what’s happening elsewhere without actually being there in person.
Not sure it will catch on, smells of witchcraft.
@Bugaloo: Moaning about moaners is a good thing in my book.
@Justin Gillespie: No way!!!!!!!! :-O
@David Corrigan: You don’t have to travel far. Try NI and the UK first and compare. Then try a few countries in south eastern Europe and see what economic depression looks like outside of the tourist spots. Plenty of cities in the US have been in depression for years
@Mickety Dee: It’s terrible altogether.
GDP is a terrible metric, invited in the US in the 1930s. It is a poor measure of prosperity. It is not even a reliable gauge of production. It’s well past its retirement time.
Furthermore, it has now become a propaganda tool for politicians who are saying the economy is on the way to a robust recovery.
If GDP growth % is lower than the inflation % we are contracting, not growing. And actual inflation is much higher than 7%. Creative accounting at it’s best, lies at worst.
ERSI are talking s**t the real economy is already slowing down
have your say