With GDP (gross domestic product) proving such a troublesome metric, former Central Bank governor Patrick Honohan used to exhort us to see Ireland’s economy through the lens of employment.
Of course, he was mainly talking about our recovery from the financial crisis, which, at the worst point, saw unemployment rise to almost 16 per cent.
At the time there was concern we would have a renewed bout of long-term unemployment, a germ that afflicted the economy in the 1990s and one that is hard to overcome.
Ireland’s post-crash employment trajectory has, however, been remarkable. About a million additional jobs have been created since 2015, delivering an employment total that surpassed 2.8 million (for the first time) in the second quarter of this year.
The headline stat formed the centrepiece of the Central Statistics Office’s latest Labour Force Survey, published on Thursday.
To put this in context, 2.8 million is equivalent to the entire population of the Republic in 1961. Back then, the economy was blighted by poor growth, low living standards and mass emigration.
Despite the current global slowdown and the trade uncertainty caused by US tariffs, labour demand remains strong and is being facilitated by two dynamics: immigration and greater participation, particularly among women.
The CSO noted that increased immigration added 49,200 workers to the labour force in the year to the second quarter, while increased participation (by both men and women) rose to 66.4 per cent, up from 66 per cent, and contributed an additional 24,300.
Another trend highlighted by the CSO was hours worked, which cumulatively rose to 88.9 per week in the second quarter.
Of course, this obscures what average workers are doing. A separate report by the Department of Finance last week indicated workers were on average working two hours fewer a week than before the pandemic.
The drop in hours worked was found to be greater among employees with flexible arrangements compared with those who are office- or site-based.
However, average hours worked also declined among on-site workers and across nearly all sectors of the economy “suggesting that flexible working arrangements are not the primary driver of declines in working hours”.
Average hours worked tend to fall as countries get richer, it said.
There’s a lot going on under the bonnet of the State’s labour market.