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Sunday 26 January 2020

Wages race ahead but fail to keep up with 6.7pc rent rise

Average pay packets are up
Average pay packets are up

Wages for thousands of full-time workers are growing almost three times faster than average, but are still not keeping pace with rent hikes.

New data reveals a great divide between pay movements in a variety of sectors in the past year.

While average pay for administrative, transport and storage staff raced ahead by 6.6pc to June this year, it fell for civil service and defence workers.

However, even the fastest rise did not keep up with rent, which rose by 6.7pc in the same period.

More sluggish house price growth meant that buying a property became more affordable during the year.

Information and communication workers still command the highest average yearly pay of €65,815. Their earnings rose by just under 5pc.

Staff in financial services, insurance and property are not far behind, with a yearly gross pay packet of €64,856-a-year.

The lowest paid full-time workers in the accommodation and food services industry earn €26,683-a-year and their wages grew by 1.6pc.

However, their earnings now lie far behind another sector often described as low paid - the retail and wholesale trade - where full-time wages grew by over 3pc and average €41,917.

An upturn in construction has meant workers have seen their pay rise by almost 4pc and their average full-time earnings are €44,264.

The figures charting full-time earnings from the Central Statistics Office show they grew by an average 2.5pc in the year to June, with average earnings across all sectors at €48,204-a-year.

Tom McDonnell, senior economist at the Nevin Economic Research Institute, said wages have started to catch up with employment growth.

Recover

"We are seeing this throughout the West, including the US and parts of Europe," he said.

"Ireland is just catching up as it took us longer to recover."

He said if you subtract inflation costs from the average rise in earnings, there was a 'real' wage increase of 1.4pc.

"Thus, on average there was an increase in purchasing power for most of the workers. However, most renters are likely to have experienced a further fall in living standards," he said.

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