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Record rise in wages can't keep up with cost of housing

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Pay packets are stretched. Stock image

Pay packets are stretched. Stock image

Pay packets are stretched. Stock image

Average weekly earnings rose by 3.5pc last year to the highest level on record but still failed to keep pace with the rising cost of accommodation.

According to data from the Central Statistics Office (CSO) weekly earnings in the fourth quarter of 2019 were €783.62, up from €757.21 in 2018 and 11.6pc higher than the same period of 2014.

"There are variations in earnings across the sectors of the economy with the highest average weekly earnings of €1,241.42 in the Information and communication sector," said the CSO.

"The lowest average weekly earnings were €381.50 in the accommodation and food service activities sector."

While wage rises are stronger here than in the rest of the eurozone, costs are rising sharply too.

In the 12 months to January - the latest available data - housing rent and mortgage costs rose 3.9pc, taking a larger share of salaries despite overall subdued inflation.

Even though wage rises have accelerated recently as the labour market has tightened - CSO figures show a job vacancy rate of 0.9pc across the economy - weekly pay packets are just 8.6pc more than they were 12 years ago when they hit a pre-crash high of €721.89.

Other countries have seen average weekly earnings rise too with record numbers now in work across much of the developed world.

In the UK, for example, pay excluding bonuses, is rising at 3.2pc a year, although in inflation-adjusted terms, wages there have only just recovered to pre-crisis levels.

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