Economy has turned a corner says top recruiter
Threefold increase in construction jobs since the start of the year
THE head of one of the biggest recruitment agencies in Ireland believes that a recent pick up in construction jobs is one of the strongest signs yet that the Irish economy is starting to recover.
The number of construction workers taken on as contractors since early July is three times the number hired in the first three months of this year, according to the latest figures from Hays Ireland.
"Construction firms significantly cut their staff numbers during the recession and teams which were very lean are now relying on contractors to give them the agility to take on new business," said Richard Eardley, managing director of Hays Ireland.
"We see this as the first indicator of recovery."
Earlier this week, it emerged that Ireland has pulled out of recession. Ireland's Gross Domestic Product (GDP), which measures economic growth, increased by 0.4 per cent between April and June, according to the latest figures from the Central Statistics Office (CSO). This is the second time in five years that Ireland has crawled out of its economic downturn. The country was pushed back into recession at the start of this year when GDP contracted by 0.6 per cent.
As well as seeing a pick up in contract work for builders, Hays has recorded a 41 per cent increase in the number of permanent jobs being offered to construction workers. "This means projects are securing funding and companies are more confident about the work continuing to come in," said Eardley. "Temporary workers in construction are up 40 per cent compared to this time last year – the biggest growth rate of any sector in which we recruit. This only happens at the start of an upturn. There is a spring in the step of the partners of those surviving firms of architects and engineers in Dublin. They have work on the drawing board."
The construction sector is just one area where Hays Ireland has seen a jump in recruitment. The number of jobs in office support has doubled over the last year, while recruitment in IT and financial services has increased by about a third.
"Office support is another area that experiences a massive drop in a recession and is the first place where companies start to hire when they are confident of growth again," said Eardley. "Overall, the numbers of temporary workers across all sectors are almost back to pre-recession levels."
In 2007 – the year before Ireland fell into its worst recession ever, Hays travelled across the world to find architects and engineers from the Far East and Africa to take up jobs in Ireland.
Today, the agency is trying to entice back Irish emigrants who left the country during the downturn to find work.
"We're now working across the globe to see who's ready and willing to come back to work in design, engineering and surveying," said Eardley.
Despite the pick up in recruitment recorded by Hays, and the slight improvement in Ireland's GDP figures, this country's domestic economy – which includes money spent in local shops and restaurants – shrunk by 0.4 per cent between April and June.
Commenting on the latest CSO figures, Dermot O'Leary, chief economist with Goodbody Stockbrokers, said: "We're not quite out of recession yet but trends are definitely heading in the right direction. Domestic demand is still down. We believe that next year will be the first time since 2007 that domestic demand will grow."
Philip O'Sullivan, chief economist with Investec, described the rise in Ireland's GDP as "positive".
"We expect to see growth accelerating in the second half of this year – and into next year," said O'Sullivan. "Domestically things are getting more stable. Externally, there's been a big pick up in growth in the US Britain and eurozone. We are seeing encouraging signs from sectors which were previously on their knees – such as the construction sector."
However, the increase in GDP between April and June was much weaker than expected, warned Alan McQuaid, economist with Merrion Stockbrokers. "Even if there is overall growth for the year as a whole, it is likely to be very small and well below government projections," he said.
"However, assuming the global economy continues to regain momentum over the next 12 months, and Budget 2014 doesn't impact too negatively on household disposable income, growth next year should pick up into the range of 1.5 to 2.0 per cent."