THE collapse in Irish personal spending is like what happened during the Great Depression in the US.
That's according to the Economic and Social Research Institute (ESRI) which said Ireland has suffered the fastest and largest fall in personal spending of any of the crisis-hit European countries.
Growth is now expected to be weaker than previously forecast because of the slowdown in the eurozone and the UK, Ireland's main export markets, the ESRI also warned.
"The fall in personal per-capita consumption in Ireland during the crisis has thus far outstripped anything seen amongst the non-crisis nations of Europe and has, given available data, constituted the largest and fastest fall among the crisis nations," the ESRI report said.
"In fact, historically, the consumption collapse in Ireland is comparable to that experienced by the United States during the Great Depression."
The decline in consumption here was the most rapid experienced by the crisis states -- Greece, Portugal, Spain, Italy and Ireland -- and beyond anything experienced in the non-crisis states of Germany, France, Austria, Netherlands and Finland, the report said.
The think tank heaped pressure on the Government and the public sector unions to come up with significant gains in the renegotiation of the Croke Park Agreement to help allow the State to meet its bailout targets for next year.
In a separate commentary, it said public sector pay remains relatively high compared with the private sector. Extension of the agreement represented an attempt to tackle the pay issue, it said.
"As we understand it, the proposals encompass pay cuts, longer working hours, changing increments, a cut in overtime rates and changes in work practices," the commentary said
The reported proposals would go a long way to dealing with payroll cuts and increase the workload of staff.
But the ESRI warned that it was particularly important to control pay in the health service.
"Hospitals do not have the option of turning away seriously ill people," it said.