You can tell a lot about a country from its demographics. If you knew nothing about Ireland or the monumental impact of the Famine, you could tell something existential had happened from the fact that its population now is still lower than it was 170 years ago. On the basis of current growth rates, it will take the Republic until 2051 to reach its pre-Famine population of 6.5 million, meaning the shock wave from that seminal event in Irish history will play out, in population terms, for at least two centuries.
The State is also unique in European terms in having a population that is 80 per cent larger than it was just 60 years ago.
We missed out almost entirely on the postwar baby boom which spurred massive population surges in the United States and Europe. A prolonged pattern of emigration, a reflection of the dismal economic conditions that prevailed after independence, saw the Republic’s population shrink to a low of 2.8 million in 1961. But since then it has grown strongly, a pattern that continues today while other countries are experiencing declines. We still have one of the highest birth rates of the EU27. When countries become more prosperous, birth rates typically trend down.
Central Statistics Office (CSO) figures published last week indicate the State’s population rose by 88,800 to 5.1 million in the 12 months to April this year. This is the first time the population has also been consistently above five — million since 1851.
How does VAT in Ireland compare with countries across Europe? A guide to a contentious tax
‘I was a cleaner in my dad’s office, which makes me a nepo baby. I got €50 a shift’
Will we have a tax liability if Dad gives us his home while he is alive?
Finding a solution for a tenant who can’t meet rent after splitting with partner
One of the key trends to emerge from the data was the increase in births, which rose to 60,700, up from 55,500 the previous year. Prior to 2021, the State’s birth rate had been steadily declining, a reflection of the fact that women are having children later in life and the proportion of the female population of a child-bearing age is falling. It seems, however, that the Covid-induced lockdowns of 2020 triggered a mini baby boom to buck the trend. It’s not unusual for seismic events to unleash an uptick in births or marriages or even divorces.
Apart from a natural increase — more births than deaths — the only other way a country’s population can grow is through net inward migration. The CSO figures show the number of immigrants entering the State last year jumped by more than 85 per cent to a 15-year high of 120,700. The agency noted that inward immigration has only been higher once in the past 30 years — in 2007 when the State saw an influx of migrants in the wake of European Union enlargement. The big increase is explained by the arrival of some 28,000 Ukrainians fleeing the Russian invasion. Without them, immigration would probably have tracked the pre-Covid trend.
The other big data point we got from the CSO last week relates to the labour market and the fact that employment in the Republic now stands at an all-time high of 2.55 million. Significantly the total is about 200,000 higher than the level of employment seen in 2019 just prior to the pandemic. It comes on the back of increased participation in the labour force, particularly among women.
The participation rate is a measure of the economy’s active workforce, in other words those working and those seeking employment. Before the pandemic the participation rate for women was 56 per cent, now it’s just shy of 60 per cent. At the height of the Celtic Tiger in 2007-2008 it reached 57.6 per cent, but fell in the immediate aftermath of the crash. One of the eye-catching trends seen during Covid was the increased number of women at work, suggesting the shift to remote working may have provided greater flexibility, facilitating greater participation. The gender differential in the participation rates has been more pronounced here than in other European countries, suggesting women still assume the stay-at-home parent and homemaker roles, an issue that fuels a significant gender pay gap.
Countries with greater levels of female empowerment tend to be more productive and therefore more prosperous.
Regardless of the political backdrop, a fast-growing population and labour force point to relatively strong economic conditions. The unemployment rate in the second quarter was put at 4.5 per cent, the lowest level since 2005, and a level that economists suggest is close to full employment in the Irish economy. Covid-adjusted unemployment had surged to 30 per cent at the height of the pandemic.
There may be many things wrong with Ireland — the housing crisis seems to go from bad to worse, the health system is woefully under-resourced and creaking at the seams, and the current cost-of-living squeeze will cause serious financial distress for many households in the coming months — but on a macro level the country has never been as economically prosperous.
