Subscriber OnlyOpinion

David McWilliams: Dublin is squeezing out low-income workers

Capital generates over half of Ireland’s tax income but high rents are killing diversity

This week Dublin was ranked the top city in Ireland and the UK to live in, focusing attention on what makes a make a great city. All over the world, cities are driving economic growth. Ireland is no exception. Dublin is more dominant now than ever before.

Money and people are attracted to the capital for cultural, social and economic opportunities. But it’s not all one-way traffic. Dublin also gives back enormously. For example, the capital generates over half the tax revenue of the country.

Far from sucking in the resources of the country or being “favoured” over rural Ireland as is often casually asserted by rural TDs, the truth is that over €5 billion of the total taxes taken from Dubliners’ pockets is redirected every year from Dublin to the rest of the country and pays for other citizens’ welfare, grants and subsidies.

A flourishing city is about diversity

The relationship between the city and the country is symbiotic. As a result it is in everyone’s interests that the city continues to thrive.


But what makes a city thrive economically, culturally and socially?

A flourishing city is about much more than shiny new architecture or dynamic hubs of high-tech industries populated by well-heeled workers. A flourishing city is about diversity. And by diversity, we are not only talking about ethnic or cultural diversity but about class diversity, income diversity, age diversity – all living together check by jowl.

In her seminal book The Death and Life of Great American Cities the wonderfully iconoclastic Canadian economist Jane Jacobs argued that great cities aren't created at urban planners' drawing boards, in fact cities evolve organically.

Jacobs suggested that cities are like humans with different organs all dependent on each other moving in harmony. She postulated that all the elements of the city – the people, the streets, the businesses, the government, the parks, public spaces and the general economy – work together.

Crucially in her view, the streets were the most important artery of any city. Streets are the lifeblood that sustains everything, where people meet each other, trade with each other and make the city buzz. Jacobs described the street and all the little transactions and meetings on the street as the “sidewalk ballet” of the city.

Dublin's most famous chronicler James Joyce was also a lover of the public space and the serendipitous meetings and experiences that the street afforded the citizen.

Why else would he have set Bloom walking around the city? He too shared this notion of the living city, packed with all sorts of characters.

For the streets to be vibrant, Jacobs identified four specific essentials that had to be in place. First, the districts have to have many different functions so that people are on the street at all times of the day and night. She argued, for example, against having specifically targeted “business districts’ because these districts empty out at 5pm and become wastelands.

Great areas should have lots of different styles and qualities of buildings and streets, allowing lots of diversity in rents

Her second condition was that cities needed to have not just high-rise buildings and plazas but also smaller buildings and intricate streets. Sometimes when we think of modern vibrant cities we think glossy architecture, but Jacobs warned against this, favouring more mixed height development with easy access and proximity to the street.

Third, she argued that great areas should have lots of different styles and qualities of buildings and streets, allowing lots of diversity in rents, accommodation and retail.

Fourth, Jacobs noted one aspect of all great American cities was that they had a high concentration of different types of people in successful neighbourhoods meaning families, old people, entrepreneurs, migrants, workers, students and artists, all living together.

Real diversity

Obviously, there will always be “posher” districts but, in general, urban districts should be as mixed as possible and if not possible on specific streets, at least the city itself should support real diversity of income, talent and classes in its centre.

This idea of a diverse ecosystem presents a dilemma for the modern service-based city because the city attracts better than average talent, who expect better than average rewards.

At the moment, Dublin is creating lots of well-paid jobs for tech-savvy coders, finance professionals, lawyers and designers. If we can capitalise on Brexit, this trend will become more pronounced.

Just think how boring Leopold Bloom's Dublin encounters would be if the place was only populated by affluent Google workers

These developments are evidenced in the boom in commercial development all around the city.

But then we have to ask a question about the workers who clean these buildings, the people who work in retail where these professionals shop, the people who serve in bars and restaurants. Where will these people live?

Over the past few years, as rents have risen, the centre of Dublin between the canals is increasingly out of reach for lower paid workers and now, even well paid workers.

For example, according to, the average monthly rent for a two-bedroom flat in Dublin 1 in 2011 was €1,045 a month. Today it is €1,500. That’s an increase of nearly 50 per cent.

However, the increase in average wages has been much lower. In 2011 the average wage was €806 a month, today it’s €852 per month, before tax. That’s an increase of just over 5 per cent.

So you can see that rents have risen 10 times faster than incomes. Rents in Dublin 2,3,4,5 and 6 reveal increases of a similar magnitude over the past seven years rendering “central Dublin” out of reach for average workers – and far beyond the budgets of low-skilled service workers.

So where are lower-wage workers going to live in the future?

According to, rents in what are now suburban commuter towns such as Maynooth, Navan and Portlaoise have only risen 5 per cent since 2011. Therefore, poorer workers will have to live in these suburbs. This process could be termed the “suburbanisation of poverty” because the service jobs that low-paid workers do only exist in the city.

Therefore, in the future the poor will commute, and Jane Jacobs’s vision of the diverse living city will founder on the rock of high rents. If the city ceases to be a thriving, diverse ecosystem with rich and poor, young and old, bohemian and bourgeois living check by jowl, it will become much less attractive for everyone.

Just think how boring Leopold Bloom’s Dublin encounters would be if the place was only populated by affluent Google workers.

Getting housing in the city right is essential not just for Dubliners but – considering the huge tax surplus that Dublin generates – for the rest of the country too.