Jobs Growth Continues but Slowing in BMW regions

The latest CSO Quarterly National Household Survey was released yesterday. This data refers to the period Quarter 2 (April-June) 2016.

The overall picture is quite positive with the number of people at work increasing by 2.9% in the past year (Q2 2015–Q2 2016).  This is almost identical to employment growth in the previous year, 3% between Q2 2014 and Q2 2015.  There seems to be a steady continuation of jobs growth nationally.

Regional patterns of employment growth

As with all national data, if you drill down to regional level you find some interesting differences.  Fig. 1 shows employment growth in each of the eight NUTS3 Irish regions over the past two years. In the most recent year (Q2 2015-Q2 2016) regional employment growth ranged from 4.3% in Dublin to just 0.5% in the Midland region.  While Dublin, the Mid-East, South East and Mid-West all had higher growth than the national average, employment in the Midland, South-West and West regions increased by under 1%.

Fig. 1: Percentage change in number of people in employment by NUTS3 region, Q2 2014–Q2 2015 and Q2 2015–Q2 2016. Source: CSO, Quarterly National Household Survey, Q2 2016

Fig. 1: Percentage change in number of people in employment by NUTS3 region, Q2 2014-Q2 2015 and Q2 2015-Q2 2016. Source: CSO, Quarterly National Household Survey, Q2 2016

Compared with a year previously (Q2 2014-Q2 2015), Dublin, the Mid-East and Mid-West experienced higher growth; in all other regions it was lower. The Greater Dublin Area (Dublin and Mid-East) in particular experienced far greater jobs growth from 2015 to 2016 than it had the previous year.  The Border and South-West meanwhile had very substantially lower growth.

When examining statistics at a smaller scale of course, they are more prone to fluctuation across years e.g. a major factory closure or opening in a year can strongly influence growth/decline in a region. However, there does seem to be a general pattern of some slow-down in jobs growth in the Border, Midland and West (BMW) region, as well as the South-West, over the past year.

Regional unemployment rates

In Q2 2016, unemployment rates ranged from 10.8% in the South East to 6.9% in the neighbouring Mid-East (Fig. 2). The three BMW regions also had unemployment rates above the national average.

Fig. 2: ILO unemployment rate in NUTS3 regions, Q2 2016 (not seasonally adjusted). Source: CSO, Quarterly National Household Survey, Q2 2016

Fig. 2: ILO unemployment rate in NUTS3 regions, Q2 2016 (not seasonally adjusted). Source: CSO, Quarterly National Household Survey, Q2 2016

Tracking unemployment rates since 2007 (Fig. 3) it is clear that the South East and Midland regions have consistently shown the highest unemployment rates, though they are following the general pattern of decline since 2012.  The Mid-east, Mid-West and South West showed the steepest declines in their unemployment rates over the past year.  The first two also had strong employment growth (see Fig. 1 above).

Fig. 3: ILO unemployment rates in NUTS3 regions, Q2 2007 – Q2 2016 (not seasonally adjusted). Source: CSO, Quarterly National Household Survey, Q2 2016

Fig. 3: ILO unemployment rates in NUTS3 regions, Q2 2007 – Q2 2016 (not seasonally adjusted). Source: CSO, Quarterly National Household Survey, Q2 2016

Decline in numbers in unemployment

The Border and Dublin regions showed practically no change in their unemployment rates between 2015 and 2016 (see Fig. 3 above). The reason for this is clear from Fig. 4. Dublin was the only region that actually experienced an increase in the number of people unemployed.  The very strong growth in Dublin’s labour force over the past year (4.4%) led to both strong growth in the numbers at work and also increased unemployment.

The Border had the smallest decline in the number of unemployed.  This compares with a very substantial fall the previous year. These two regions, plus the West, were the only ones with a smaller improvement in unemployment in this period than the previous.

There were large unemployment declines in the South West, Mid-West and Mid-East reflected in their sharply declining unemployment rates (see Fig. 3 above).  Apart from the first, these regions also showed strong employment increases (see Fig. 1 above) indicating that a significant cause of the fall in unemployment was likely movement into employment.  In the case of the South West however, it had relatively low employment growth ( see Fig. 1 above). This region had the largest fall in the size of its labour force in this period (-1.9%), so an important factor in its unemployment decline was likely unemployed people leaving the labour force (e.g. moving out of the region, retiring, returning to education).

Fig. 4: Percentage change in number of people unemployed by NUTS3 region, Q2 2014–Q2 2015 and Q2 2015–Q2 2016. Source: CSO, Quarterly National Household Survey, Q2 2016

Fig. 4: Percentage change in number of people unemployed by NUTS3 region, Q2 2014–Q2 2015 and Q2 2015–Q2 2016. Source: CSO, Quarterly National Household Survey, Q2 2016

Conclusion

The latest QNHS figures show a continuing positive labour market trend nationally and regionally. There are indications however of some slowing down of employment growth in the BMW regions as well as relatively lower falls in unemployment compared with some other areas of the country.   This is reflected in persistently higher unemployment rates in the Midland, Border and West regions, as well as the South East. The Greater Dublin Area (Dublin and Mid-East) has shown particularly strong jobs growth in the past year, though Dublin’s expanding labour force has meant that this jobs growth has not led to declining unemployment.

The regional data shows that Ireland has a complex labour market with many factors influencing regions’ performance.  When the full Census 2016 results are published next year, it will be possible to drill down to a far smaller spatial scale to examine labour market patterns within these NUTS3 regions and the different experiences of rural areas, small towns and villages, large urban centres and the cities.

Pauline White