Earnings growth lags inflation almost fourfold, data show

Average weekly earnings were up 2.4 per cent in the second quarter, lagging the rate of inflation almost fourfold, new data from the Central Statistics Office (CSO) show.

The CSO’s earnings and labour costs data for the period lay bare the squeeze on households as they grapple with the worsening cost of living crisis. Average weekly earnings were €871.62, which represented an increase of 2.4 per cent compared with €850.81 from one year earlier.

Prices in the Republic rose an estimated 9.1 per cent in the year at the end of the same period, according to the consumer price index, which is also compiled by the CSO. The cost of energy, transport and food are the main drivers of inflation, which Davy chief economist Conall MacCoille warned on Monday could top 13 per cent in the coming months, intensifying the squeeze on households.

The weekly earnings data show the sector showing the largest annual percentage increase was the information and communication sector (11 per cent) where average weekly earnings rose from €1,299.98 to €1,442.80 in the year.

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The second largest increase was 9.5 per cent in the transportation and storage sector which rose from €794.61 to €870.10 over the year.

In the five years up to the second quarter, average weekly earnings rose by 21 per cent. All sectors saw increases in average weekly earnings over that period.

Average hourly earnings increased on an annual basis by 2.7 per cent to €26.78, while average weekly paid hours recorded no change in the year, remaining at 32.6. Average hourly total labour costs were €30.93 across all economic sectors. The sector with the highest average hourly total labour costs was information and communication, with a rate of €48.39. That was followed by the financial, insurance and real estate activities sector where workers were paid €45.72 an hour.

The sectors with the lowest cost of employing labour were the accommodation and food services activities sector with an average hourly total labour cost of €14.72, and the arts, entertainment, recreation and other service activities sector with €22.80.

Average hourly total labour costs increased by 19.6 per cent over the five years, from €25.86 per hour to €30.93.

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The percentage changes across the sectors ranged from 31 per cent in the information and communication sector to 5.2 per cent in the accommodation and food services activities sector.

Average weekly earnings increased by 1.2 per cent across the public sector in the year, rising from €1,030.85 to €1,043.57.

An Garda Síochána recorded the highest average weekly earnings in the public sector of €1,503.32 while the education sector recorded the highest average hourly earnings in the quarter of €43.44.

The job vacancy rate, which measures job vacancies on the last working day of the quarter, was 1.6 per cent, recording no change from the end of the previous quarter and up from 1.2 per cent last year.

The sectors with the highest job vacancy rate in the quarter were the professional, scientific and technical activities sector with a rate of 4.4 per cent, followed by the financial, insurance and real estate activities sector with a rate of 3.1 per cent.

Rounded to the nearest 100, the number of job vacancies at the end of the quarter was 34,800, representing an increase of 11,000 from the number of vacancies at the end of the same period last year.