The latest employment figures provide the clearest evidence that the economy is in good health. The quarterly national household survey, taken between December 2003 and February 2004, shows that employment was 52,300 higher than one year earlier. This is an extraordinarily buoyant performance against a mixed international backdrop. As a result of the strong performance of the jobs market, the unemployment rate has fallen back to 4.4 per cent.
There has been much debate on the legacy of the economic boom of the late 1990s covering issues such as quality of life and inequality. However there can be no reservations about the performance of the jobs market. Just six years ago, the unemployment rate was almost 9 per cent and many people were not able to find a job. Now, after a brief slowdown reflecting general economic conditions, the labour market has come back to life; we may already be in a situation where there are more jobs on offer than there are people qualified to fill them.
IDA Ireland, meanwhile, which has had a number of notable successes in recent months reported yesterday that the outlook was good for the rest of the year. Particularly encouraging is the nature of many of the projects, including high level manufacturing and research-based activities. There is much to be done to build Ireland's position in this area of knowledge-based industry in areas such as building research capabilities and expertise and links between the third level sector and industry. However projects such as those being undertaken by Intel, which recently announced a new microchip processing plant and Wyeth, which is developing a major biopharmaceutical plant, give cause for optimism.
Whatever policies are pursued in the years ahead, a key aim must be to underpin this transformation in the jobs market and maintain a low unemployment rate. This has implications for the national pay talks and for policy in a range of areas. The jobs gain comes despite a fall-off in competitiveness in recent years and a sharp rise in the level of prices in Ireland.
It would be unwise to believe that this strong performance could be maintained if competitiveness here continues to be undermined. In tourism, for example, it is hard to believe that our prospects will not be threatened if we remain the most expensive country in the euro zone in many areas.
There is much encouragement to be taken from the latest figures. They suggest that whatever the difficulties faced by the economy in recent years, many key sectors continue to thrive and that there is a good foundation to build on for the future.