The total number of people in employment will continue to grow in 2017, albeit at a slower pace, with the potential for average salary increases of 5% - 10% for critical skills positions.
This is according to the latest Morgan McKinley 2017 Irish Salary Guide - Ireland’s most comprehensive analysis of pay across a range of professions and sectors.
Last year saw a strong performance for the Irish economy with GDP growth increasing and the unemployment rate decreasing to 7.3% during the year, its lowest level in eight years. These positive indicators resulted in strong upward trends in domestic consumption and general investment, which did slow in the second half of the year due to the unanticipated outcomes of Brexit and the US presidential election.
The report indicates that potential salary increases in 2017 will range from 5% - 10% in areas of high skill demand, most notably ICT, Science, Engineering, Accounting and Financial Services.
Morgan McKinley believe Ireland is a price taker in Global markets where the competitiveness of our internationally tradable outputs is essential to economic growth. Changes in the non-traded sector of the economy can have significant implications for the traded sector, placing additional pressure on private sector salary inflation.
They stress that maintaining a balance between appropriate reward structures and overall national cost competitiveness is essential to ensure that economic recovery and renewal continues.
The guide indicates that the most in demand talent will continue to be in the Pharmaceutical, Financial Services and IT sectors. Growth in demand for ‘hybrid talent’ in the FinTech space is being driven by new FinTech companies and the innovation labs of large banks and consultancies. The most sought after professionals in IT will have Big Data, Java Developer and Cybersecurity expertise.
Financial services players with dual operations in the UK and in Ireland are likely to build bigger teams in Ireland to underpin their EU presence as well as the potential of further relocation of industry operations and new direct investments. FDI sectoral employment remains strong with ICT, Engineering, Science, Data Analytics and Business skills in most demand.
Furthermore, while there are positive trends being seen in gender quotas across many sectors (including science, engineering and technology), research for Morgan McKinley in 2016 identified an average earnings gap of 20% between men and women in professional jobs.
The ‘pay gap’ which represents a global rather than Ireland only trend is however a demotivating influencing factor on the potential for women to enter careers in important sectors of the economy. This is an anomaly particularly where there are skills shortages that could be addressed through the continuing promotion of gender diversity and pay transparency.
Chief Operations Officer of Morgan McKinley, Karen O’Flaherty said, "Total employment in Ireland is at its highest level since 2008. Forecasting is difficult given uncertainty around Brexit and potential implications for the Irish economy including a reduction in the predicted growth rate of GDP to 3.4% (down from 3.9% pre-Brexit)."
He added, "FDI employment demand is currently strong and tracking ahead of the Horizon 2020 employment creation targets set and it remains to be seen if there will be positive or negative impacts on FDI flows arising from Brexit and from changes in the US administration. However we firmly believe that Ireland’s talent base and supportive infrastructure remain very attractive to inward investment."