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11. Labor Policies and Practices

Ireland’s population in April 2018 was 4.86 million, up by 64,500 from the previous year.  Net migration in the year was 34,000 persons. The total number of persons employed in 2018 was 2.28 million, up by 51,000 persons on the previous year.  Employment opportunities in the early part of this century attracted unprecedented inward migration levels, particularly from Eastern Europe. However, the 2008 construction industry collapse led to a sharp increase in Ireland’s unemployment rate, which peaked at 15.1 percent in early 2012.  With the downturn, many economic migrants left Ireland to return home or search for employment opportunities elsewhere. Economic recovery and increased employment opportunities has seen a dramatic fall in the unemployment rate and by March 2019 it had reached 5.4 percent.

Despite the decline in unemployment levels, some areas of Ireland continue to have higher unemployment rates than others.  The proportion of youth (under-25) unemployment continues to be high, although significant emigration has lessened this problem.

Private sector wages increased by 4.4 percent in 2018.  During the year, the average industrial earnings increased by 1.7 percent to 898 euro (USD 1,061) per week.  The minimum wage rate increased by 0.30 euro to 9.80 euro per hour in January 2019, with lower rates set for younger and less experienced workers.

In general, the Government regulates the Irish labor force less than is done in most continental EU countries.  The workforce has a high degree of flexibility, mobility, and education. There is a relative gender balance in the workforce, with 1,231,300 males and 1,050,000 females employed in 2018.  This gender balance reflects a change in social mores and government support that have facilitated a surge in female employment since the mid-1980s.

Ireland has been an attractive destination for foreign investment due to its availability of a young, highly educated workforce.  The removal of tuition fees for third-level (university) education in 1995 resulted in a rapid increase of individuals who hold third-level qualifications.  (Students must still pay registration fees, currently capped at 3,000 euro or USD 3,390 per year). The availability of highly educated and qualified potential employees makes Ireland an attractive place to do business.  That availability has been a significant factor in attracting the large number of multinational companies that have located operations in Ireland. Over 60 percent of new third-level students in Ireland undertake business, engineering, computer science, or science courses.  The focus of government strategy has shifted to upgrading skills and increasing the number of workers in technology-intensive, high-value sectors to ensure the availability of an educated workforce.

The Irish system of industrial relations is voluntary.  Employers and employees generally agree to pay levels and conditions of employment through collective bargaining.  There are generally good industrial relationships and there were just ten firms involved in industrial disputes in 2018.  The Government negotiated a series of agreements since 2010 on public service pay and conditions that have in general reduced public service labor disputes.

Employers typically resist trade union demands for mandatory trade/labor union recognition in the workplace.  While the Irish Constitution guarantees the right of citizens to form associations and unions, Irish law also affirms the right of employers to withhold union recognition and to deal with employees on an individual basis.  Currently, around one-third of all workers are unionized; however, there is much higher participation in unions by public sector workers. The Government estimates up to 80 percent of workers in foreign-owned firms do not belong to unions.  This may reflect more attractive pay, benefits, and conditions by these employers compared with domestic firms. The Department of Business, Enterprise and Innovation explicitly addressed the country’s collective bargaining rights through an amendment of existing legislation in the Industrial Relations (Amendment) Act 2015.

Investment Climate Statements
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The Lessons of 1989: Freedom and Our Future