ECONOMIC GROWTH (VOLUME)

According to Central Statistics Office data, the y-o-y increase in GDP at constant (1995) market prices in 2002 was 6.9% while the corresponding increase in GNP was 0.1%.  The following table shows growth in GDP and GNP in constant (1995) prices and the corresponding values in current market prices.

*preliminary

These figures represent the average of the expenditure and output estimate of GDP and GNP respectively.

According to the latest CSO figures, which are preliminary estimates, GDP grew by 2.1% year-on-year in the second quarter of 2003.  GNP was estimated to have grown by 3.1% year-on-year in the same period.  The figures for the first quarter were 0.7% for GDP and 1.0% for GNP.

BUDGET INDICATORS

Exchequer Balance

The 2002 Exchequer Surplus was €95 million, which compares with the 2002 Budget target of €170 million. The Exchequer Surplus in 2001 was €653 million.

General Government Balance

The estimated outturn for the General Government Balance (GGB) in 2002 is a deficit of 0.2% of GDP on an ESA 95 basis.  The 2003 estimate for the GGB is a deficit of 0.4% of GDP. 

General Government Receipts and Expenditure

An advance release calendar for central and general government - one quarter in advance - is available on the IMF Dissemination Standard Bulletin Board (details below).

General Government Debt

Ireland’s General Government Debt to GDP ratio was 36.1% at end-2001.  The outturn at end-2002 was 32.4% and the forecast for end-2003 is 33.6%.

BALANCE OF PAYMENTS – CURRENT ACCOUNT

There was a deficit of €389 million on the current account of the Balance of Payments in the second quarter of 2003.  This compares with a deficit of €471 million in Q2 2002.  The deficit in Q2 2003 was due to debit balances under the Services heading and the Income heading, which more than offset the credit balances under the Merchandise Trade heading and the Current Transfers heading.  The current account deficit for the year 2002 was €954m compared to a deficit of €757m for 2001.

EMPLOYMENT

Labour Force Survey / Quarterly National Household Survey

The latest Quarterly National Household Survey indicates that in the twelve months to the quarter March to May 2003:

-  Employment increased by 28,400 or 1.6%;

-  Unemployment rose by 4,200 to a rate of 4.4%;

-  The labour force increased by 32,700 or 1.8%;

-  The long term unemployment rate increased to 1.4% compared to 1.2% in March to May 2002.

Live Register

The Live Register figure for October 2003 was 166,552.  This is a fall of 4,270 on the figure for September 2003 and an increase of 8,846 on the figure for October 2002.  The underlying seasonally adjusted figure in October 2003 was 172,600, which represents an increase of 8,900 on the figure for October 2002 and a fall of 900 on the seasonally adjusted figure for September 2003.

Building and Construction Employment

Figures in the QNHS indicate that employment in construction rose by 9,300 or 5.1% in the 12 months to the quarter March to May 2003.  The CSO’s index of “Employment in Construction” release indicates that industrial employment increased by 0.7% year on year to September 2003.

Other Production

The latest QNHS indicates that employment in production (other than construction) decreased by 800 or 0.3% in the twelve months to the quarter March to May 2003. The CSO release on Industrial Employment (Preliminary Estimates) indicates that industrial employment decreased by 10,600 in the twelve months to June 2003.

Banking, insurance and building societies

The latest CSO release Banking, Insurance and Building Societies: Employment and Earnings indicates that employment in banking, insurance and building societies increased by 900 in the twelve months to June 2003. Figures in the QNHS indicate that employment in “financial and other business services” decreased by 2,200 or 1.0% in the 12 months to the quarter March - May 2003.

Public sector employment

The latest CSO Statistical Release on Public Sector Employment and Average Earnings indicates that 240,700 were employed in the public sector (excluding health), an increase of 4,800 in the year to June 2003. Figures released in the QNHS indicate that employment in public administration and defence increased by 1,500 or 1.7% in the 12 months to the quarter March-May 2003, and employment in education and health increased by 15,700 or 5.9% over the same period.

Notified redundancies

The latest figures from the Department of Enterprise, Trade and Employment show that the number of notified redundancies in 2002 was 25,358, an increase of 26.9% on the figure of 19,977 for 2001.  For the first 11 months of 2003 (Jan-November) notified redundancies were 24,844, an increase of 5.4% on the corresponding period in 2002.  There were 2,335 notified redundancies in November 2003, a fall of 7.7% on the corresponding figure in November 2002.

FÁS Training and Employment Programmes

At end October 2003, there were 25,522 people in FÁS Employment Schemes (incl. 19,588 on Community Employment). There were a further 11,298 on training programmes / schemes for the unemployed and jobseekers. The corresponding figures for those in FÁS Employment Schemes for October 2002 was 29,794 (incl. 24,380 on Community Employment) and 14,044 were attending the various other training programmes / schemes. 

EARNINGS

Industrial Earnings

The latest CSO release shows that average weekly industrial earnings in the year to June 2003 increased by 9.2%, reflecting an increase of 8.4% in the hourly rate and an increase of 0.8% in the number of hours worked.  Average weekly industrial earnings in June 2003 were €540.27.

The corresponding average increases for the manufacturing sector were 8.7% (weekly), 8.0% (hourly) and a 0.5% increase in hours worked, with weekly earnings of €515.87.

The earnings of all employees in the industrial sector rose by 8.4% to €632.49 in the year to June 2003.  Along with the 9.2% increase for Industrial Employees there was a 6.5% rise for Clerical and Managerial Employees combined.

Construction

According to the latest CSO release, average weekly earnings for all workers in the Construction sector increased by 3.9% to €662.86 in the year to June 2003 - the hourly rate increased by 3.8% while the number of hours worked grew by 0.2%.  In the same period, average weekly earnings of skilled operatives increased by 3.0% to €771.83, while for unskilled/semi-skilled workers the increase was 2.9% to €648.03.

Banking, Insurance & Building Societies

The CSO Statistical Release, Banking, Insurance and Building Societies: Employment and Earnings, indicates that average weekly earnings in the financial sector decreased by 0.2% to €707.81 in the year to June 2003.

Public Sector

The latest CSO figures show that average weekly earnings in the Public Sector (excluding health) increased by 4.5% to €730.92 in the year to June 2003.

Distribution and Business Services

The latest CSO release indicates that average weekly earnings in the Distribution and Business Services sector increased by 5.3% to €586.28 in the year to June 2003.  Average weekly earnings in the Distribution sector increased by 7.6% to €604.95 while those in the Business Services sector increased by 4.0% over the same period to €576.12.

INFLATION AND INTEREST RATES

Inflation

The latest CSO figures show that the rate of inflation, as measured by the Consumer Price Index (CPI) moderated further in October to 2.3%, compared to, 2.9% in September, its lowest level in four years.  Excluding mortgage interest rates, the underlying CPI was 3.2%.  The CPI excluding tobacco was 1.8%.  Inflation averaged 3.9% for the first three quarters of the year.  The forecast for inflation growth in 2003 as a whole, as measured by the CPI, is 3.5 per cent, as published in Budget 2004 on the 3^rd of December.

As measured by the EU Harmonised Index of Consumer Prices (HICP), Ireland’s annual inflation rate was 3.3% in October, down from 3.8% in September.  Euro area inflation in October was 2.0 %, down from 2.2% in September.

Manufacturing Output Prices

In October 2003, manufacturing output prices decreased by 8.4% y-o-y.  The prices for home sales rose by 0.3% y-o-y, while export sales prices dropped by 10.2% y-o-y.

Interest Rates

The EURIBOR one-month interbank rate on 28 November was 2.15%, up from 2.10% at the end of October, while the EURIBOR three-month interbank interest rate at 28 November was 2.15%, down from 2.16% at end of October.  Ten-year Irish Government bonds traded at close on 28 November at a yield of 4.44% compared to 4.44% for the equivalent German Government bonds.  The European Central Bank’s Repo rate at end of November was 2.00%.

House Prices

Department of the Environment, Heritage and Local Government figures show that the average price of new houses nationwide in 2002 rose by 8.3% to €198,087 while the average price of second-hand houses rose by 10.5% to €227,799. In Dublin, average new house prices rose by 5.4% to €256,109 while average second-hand house prices rose by 11% to €297,424.

In the second quarter 2003, average new house prices nationwide rose by 13.0% y-o-y to €222,532 while average second-hand house prices rose by 16.6% to €264,646.  In the same period, average new house prices in Dublin increased by 14.5% y-o-y to €289,345 while average second-hand house prices in Dublin increased by 23.4% to €367,314.

PERSONAL CONSUMPTION

Retail Sales

In the month of September 2003, the volume of sales increased by 0.1% y-o-y, with sales excluding Motor Trades recording a rise of 1.1%.  The volume increase in sales in the January-September period over the same period in 2002 was 1.0% while the corresponding increase excluding Motor Trades was 1.6%.  The volume increase in sales in 2002 was 0.8% compared to an increase of 3.1% in 2001.  The corresponding increase excluding Motor Trades in 2002 was 2.2% compared to an increase of 7.5% in 2001.

Car Registrations

Data from the Revenue Commissioners indicates that new car registrations in September 2003 were down 6.3% on September 2002 while sales of imported used cars in September 2003 were 17.5% higher y-o-y.  Cumulative sales of new cars for the period January-September 2003 showed a y-o-y decrease of 6.5% while cumulative sales of imported used cars increased by 2.8%.

OUTPUT AND EXPORTS

Manufacturing Output

Manufacturing output increased by 14.6% y-o-y in August 2003, and was 6.4% higher y-o-y for the 3-month period June-August 2003. The CSO provisionally estimates that output fell by 2.8%% y-o-y in September.  According to CSO data, manufacturing output volume grew by 8.4% in 2002, following a 10.2% increase in 2001.

Exports

First estimates from the CSO indicate that the value of exports in the month of September decreased by 4.2% y-o-y.  Detailed figures show that, for the period January-August 2003, in value terms, exports were down 17% y-o-y, including: organic chemicals down by 21%; medical and pharmaceutical products down by 8% and office machines etc. down by 19%.  Exports of food and live animals fell 3%.  In volume terms, it is estimated that exports fell by 11.6% over the same period.

TOURISM

According to CSO figures, there were 6,065,000 overseas visitors to Ireland in 2002, an increase of 1.3% over 2001.  The number of visits abroad by Irish residents was 4,634,000 in 2002, compared with 4,216,000 in 2001, an increase of 9.9%.  Earnings from overseas visitors to Ireland in 2002 amounted to €3,764 million, an increase of 1.7% over 2001.  Expenditure by Irish visitors abroad amounted to €3,956 million in 2002, an increase of 23.2% over 2001.

In the second quarter of 2003, there were 1,704,000 overseas visitors to Ireland, compared with 1,613,000 in the same period last year, an increase of 5.6%.  The number of visits abroad by Irish residents in Q2 2003 was 1,323,000, an increase of 9.5% when compared with the first quarter of 2002.

AGRICULTURE

Output

The CSO release Output, Input and Income in Agriculture 2002 indicates that agricultural output at basic prices decreased by 3.6% in 2002.  This follows an increase of 1.1% in 2001.

Farm Incomes

The same CSO release shows that aggregate farm incomes fell by 8.1% in 2002 as a result of a decrease in the output value of pigs, sheep, cattle, poultry, milk, and crops. This follows an increase in farm incomes of 6.4% in 2001.

OTHER NEWS

Information on Budget 2004 is available on the Department of Finance website.

www.finance.gov.ie

Details of forthcoming statistical releases, including the IMF’s advance calendar can be found at: http://dsbb.imf.org/Applications/web/sddscountrycategorylist/?strcode=IRL

Queries and comments to:  Joe Kirwan or Colm O’Connor, Department of Finance, 73-79 Lower Mount Street, Dublin 2.

Phone (01) 6045771 or (01) 6045772, or e-mail: Joe.Kirwan@finance.gov.ie or Colm.O’Connor@finance.gov.ie