Slowing construction and migration rates are likely to contribute to falling employment levels, the Allied Irish Bank (AIB) has warned today.
Publishing its latest labour force assessment, the bank says it expects the pace of employment in the building industry to slow due to a peak in housing supply.
AIB has forecast labour force growth to slow from 4.5 per cent in 2006 to 3.5 per cent this year, and 2.5 per cent in 2008.
The report highlights "increasing concerns" about the lack of sustainability in labour and employment growth. It points to fewer workers entering the labour force, including a drop in residents aged 15-19, and a possible pull-back in migration levels.
In general, the demand for labour can be expected to ease as GDP growth slows, it says.
Recent job loss announcements have also raised concerns about employment prospects, most notably in the manufacturing sector, AIB said.
It predicts employment in the construction sector will be affected by a predicted slowdown in house building as the property market slows, while employment growth in some sectors is being constrained by difficulties in finding suitable workers, it says.
Around 68,000 jobs will be created in 2007, but this will fall to 40,000 new jobs in 2008, the report says.