Two in every five jobs here have been disrupted by the Covid-19
pandemic, according to the accounting and professional services group EY
in its latest Economic Eye report.
The jobs have either been lost or are being supported by government
interventions, including the Employment Wage Subsidy Scheme and Pandemic
The study found that, despite apparently contradictory data on the
severity of the pandemic damage, the level of labour market disruption
has been broadly similar across the island.
EY has revised upwards its economic projections for the year owing to
the volume of government supports deployed as well as resilience in
certain parts of the economy.
The group predicts a ‘long and arduous’ recovery for some of the
worst hit sectors, including retail and accommodation, which have been
impacted by repeated waves of restrictions and closures.
However, it concludes that the economic impact during this latest set
of severe level 5 restrictions is not likely to be as damaging as the
hit during the second quarter.
“This is in large part due to the progress made in health treatments
and a more prepared business community, with greater adoption of digital
service delivery, where possible,” the report states.
“This will be scant consolation, however, to businesses in the
retail, tourism and hospitality sectors in particular, which had hoped
for a strong Christmas to make up lost sales.”
points to resilience among some services businesses, as many built on
the ability to fulfil orders and provides services digitally.
As with the last downturn, the country’s export base is proving vital
in insulating the economy against the full impact of the downturn, with
the pharmaceutical, ICT (information and communication technology) and
agri-food sectors providing the greatest support.
“If you had to pick sectors to specialise in during a pandemic, ICT,
pharma and agri-food would be top of the list. These will help to
maintain Ireland’s increasingly predictable place at the top of the
European growth charts,” Professor Neil Gibson, chief economist with EY
“Despite the well documented complexities in Irish GDP figures, the
tax receipts data support this resilience, however it should not
distract from the damage in the domestic economy which is such an
important source of employment. The insulation for this side of the
economy comes from the Government’s ability to offer financial support,
something it couldn’t do as easily in the last recession.”
The general resilience of certain sectors to enable the economy to
withstand repeated waves of pandemic restrictions has prompted the group
to revise upwards its outlook to a 3.9% contraction in GDP for this
year before returning to growth of 3.5% in 2021.