Fourteenth Issue of the Dublin Economic Monitor Launched

Dublin's Economic Resurgence is Reflected in Lowest Unemployment Rate in 10 Years

Dublin's unemployment rate fell to 5.7% in Q2 2018, the lowest level recorded in 10 years, the 14th issue of the Dublin Economic Monitor reveals, reflecting a buoyant labour market with 685,400 now employed in the Capital. While many aspects of the economy continue on an upward trend, including those covered in the Mastercard DublinSpendingPulse, other ares, namely housing and residential rents, continue to dampen potential.

Key Highlights:

  • There were an additional 13,200 employees added to the workforce in the quarter with 685,400 people now employed in Dublin. This is the highest quarterly increase in employment recorded in 10 years.
  • New data from the CSO indicates that housing completions in Dublin totalled 5,600 in 2017, a 56% increase on the total completions recorded in the Capital in 2016. An additional 1,200 completions were added in the first quarter of this year.
  • Residential rents in Dublin rose 7.8% year on year, leaving average rents at €1,527 in Q1 2018, the highest level since the beginning of the series (Q3 2007). Similar rates of growth were recorded in the Greater Dublin Area (GDA) and nationally (excl. GDA), registering 6.4% and 6.6% growth year on year respectively.
  • Residential property prices moderated slightly in May 2018, but still registered 10.7% year on year growth. This compares to year on year growth of 13% in the previous month. The series is now at its highest level since the beginning of 2009.
  • Savills Dynamic Cities Index 2018 ranks Dublin in 6th position for commercial real estate investment, driven by its continuing emergence as a financial hub.
  • Public transport trips remained stable in Q1 2018 with 53.9 million trips (seasonally adjusted) undertaken in the quarter. Q1 2018 marked the first quarter in which the LUAS cross-city was fully operational and passenger numbers grew 3.8% quarter on quarter.
  • Throughput at Dublin Port in Q2 2018 achieved a new high with 9.6 million tonnes (seasonally adjusted) handled in the three month period.

The Mastercard Dublin SpendingPulse indicates that overall growth in consumer expenditure in Q2 2018 grew by 5.2% year on year. Spending by tourists was particularly strong this quarter, growing by 16.2% in Dublin, predominantly driven by growth in the US market of 16.8% and 15.2% in the French market (seasonally adjusted).

This issue of the Economic Monitor contains a special report by Sharon Scally (Director/Chairperson, Sandyford Business Improvement District, SBID) on how the east Dublin global business quarter is driving innovation and investment for the area. A second special report by Les Moore (Head of Parks Services, Dublin City Council and Chair of the Dublin Bay Biosphere Partnership) focuses on how the Dublin Bay Biosphere has turned its UNESCO designation into an opportunity for sustainable business is also included in this issue.

Speaking at the publication of this issue, Ciara Morley, Executive at EY-DKM Economic Advisory said: “Many of the indicators we report on in the Dublin Economic Monitor show that Dublin’s economy is firmly set on an upward trend. The unemployment rate is currently at its lowest level in 10 years with an additional 13,000 people employed in the last quarter alone. Dublin’s position internationally is also strong, with the Capital improving it’s positioning in several key international rankings and benchmarks. There is little doubt though that challenges persist and housing issues remain top of the list. While house price growth has stabilised, rents continue to rise and we are a long way off achieving the level of supply required to meet demand. That being said, the future prospects for the Dublin economy through the remainder of 2018 are positive.”

Austin Hughes, Chief Economist at KBC Bank Ireland said: “Dublin consumers became a little more cautious in the second quarter of 2018 as increased uncertainty about the global economy translated into some nervousness about the outlook for jobs and a greater caution in relation to household spending plans. While the survey suggests confidence has slipped somewhat of late, it is important to emphasise Dublin consumers remain broadly positive in their thinking on the economy and their personal finances.”

Michael McNamara, Global Head of SpendingPulse, Mastercard said: “Overall the retail environment in Ireland remains solid with 4.5% growth for retail sales across the country. Dublin‘s performance was particularly strong at a 5.2% increase over Q2 2017. Dublin’s online sales continue to gain share though the growth rates have cooled somewhat from the 15%-20% range at the end of 2017. On the tourism side, expenditure increased by 16.2% YoY with some of the most exciting growth in tourism spend is coming from the U.S and China. The only area of struggling growth is from the UK, with negative growth continuing into 2018.  A key area to watch over the next 6-12 months will be the influence of Brexit decisions on the euro/pound exchange rate and the pace of UK tourism spending.”

Andrew Harker, Associate Director at IHS Markit said: “The Dublin private sector continued to perform strongly midway through the year, with output growth ticking up from that seen in the opening quarter. This improvement was partly due to a marked rebound in the manufacturing sector, which saw growth recover from the weather-effected slowdown in Q1. With new order inflows and hiring continuing apace, the Dublin economy is in a good position heading into the second half of 2018. Data suggest that strength in the Irish economy is not restricted to the capital, with rates of growth in output, new orders and employment in the Rest of Ireland only marginally weaker than recorded in Dublin.” 

The Dublin Economic Monitor is a joint initiative of the four Dublin local authorities, drafted by EY-DKM Economic Advisory, which focuses on the Dublin region, and tracks key economic indicators including the Mastercard Dublin SpendingPulse.  The Monitor captures data from the height of the boom to the economic crash and the subsequent recovery. 

Access to the full report is provided by clicking on the following link: www.dublineconomy.ie

 

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