Uneven regional impact of Ireland’s jobs recovery

There was a lot of discussion of the jobs recovery during the election campaign. In fact ‘Jobs’ was consistently ranked No. 2 in Google searches related to the Irish election this year (just behind Taxes). And much of the discussion was about where those jobs were being created.

The results of this year’s Census will give a great opportunity to really interrogate the spatial patterns of Ireland’s recent jobs performance and what has happened since 2011, especially to consider how any recovery has benefitted rural areas, villages, small towns, disadvantaged urban areas etc. However those results will not be available until 2017 so in the meantime we need to rely on survey based data, which is limited in its availability at regional or county level.

As the labour market is extremely complex, it’s difficult to fully capture that complexity, especially at smaller spatial scales where a single employer or event can have a major impact. In this blog post therefore I’ve taken a very broad look at regional job trends to try to provide a snapshot of what’s happening. The latest available regional employment data was published last week (CSO, Quarterly National Household Survey, Quarter 4 2015) and is used here.

Percentage change in employment 2006-2010 and 2011-2015

Fig. 1 shows the percentage change in the number of people at work in each of the NUTS3 regions. It compares two five-year periods, the crisis (Q4 2006 – Q4 2010) and the recovery (Q4 2011 – Q4 2015). As we know, during the crisis the South East, Midlands and Border were particularly hard hit by job losses. This included people who had been commuting from these regions into Dublin, many of whom had bought houses at the edges of the ever expanding Dublin commuter belt. Intimately linked to this, these regions also had a high reliance on the construction sector.

It was the Mid-East and West which had the smallest employment declines, the strength of Galway and its medical devices cluster is known to have contributed to this in the West. However, one of the most noticeable patterns in Fig. 1 is that the Mid-West and West do not seem to be benefitting from the jobs recovery, having employment decline in both periods. For a number of other regions, the growth they have experienced between 2011 and 2015 is less than their previous percentage decline. This is the case for the Border, South-East, South-West and Mid-East.  Only the Midlands has experienced stronger jobs growth than its earlier decline.

Fig. 1: Percentage change in employment by NUTS3 region, Q4 2006 – Q4 2010 and Q4 2011 – Q4 2015. Source: CSO, Quarterly National Household Survey, Q4 2015

Fig. 1: Percentage change in employment by NUTS3 region, Q4 2006 – Q4 2010 and Q4 2011 – Q4 2015. Source: CSO, Quarterly National Household Survey, Q4 2015

Regional employment trends 2006-2015

Fig. 2 shows the number of people in employment in each of the NUTS3 regions except Dublin (which is excluded due to scale) from 2006 to 2015. The South West, with 284,000 has the highest employment of the regions shown. The South-West shows a clear pattern of decline followed by gradual recovery, but in 2015 remains below its 2007 peak. The South-East, Border and Midlands follow a similar pattern as does the Mid-East though it did have a slight decline in 2015. The only region to regain its 2007 level of employment is the Midlands.

Again, the West and Mid-West stand out as having a different experience. While they had a similar decline from 2007, their employment trends do not show any real signs of recovery. For the Mid-West, employment has remained almost unchanged since 2012, while in the West it has declined notably since 2013.

Fig. 1: Employment by NUTS3 region (excluding Dublin), Q4 2006 – Q4 2015. Source: CSO, Quarterly National Household Survey, Q4 2015

Fig. 1: Employment by NUTS3 region (excluding Dublin), Q4 2006 – Q4 2015. Source: CSO, Quarterly National Household Survey, Q4 2015

The reasons for the weak performance of the West and Mid-West would need to be further explored. In their 2015 end of year statement, Enterprise Ireland reported that the North-West, Mid-West and West had the lowest jobs growth in companies assisted by the agency, while the poor performance of the North-West region in total agency assisted employment since 2005 has been discussed in a previous blog. The Western Region clearly faces some very serious challenges in its ability to fully benefit from the national jobs recovery.

Others have also been examining the uneven regional distribution of jobs growth, such as PublicPolicy.ie. It is a topic that clearly must be a priority for the next Programme for Government and central to the development of the new National Planning Framework, which will have to be taken up by the new Government and Minister.

Pauline White