Ireland’s labour market demonstrates resilience amid global economic uncertainties.
Despite global economic headwinds, Ireland’s recruitment industry continues to show strong underlying momentum, according to the Q1 2025 Labour Market Monitor released this week by the Employment & Recruitment Federation (ERF).
The quarterly report, compiled by Ipsos B&A, highlights that employment remains close to full capacity, with Ireland’s unemployment rate at 4.0% in March 2025, up slightly from 3.9% in February but still well below the EU average of 6.2%.
“What we’re seeing is a dynamic but tight labour market”
Permanent hiring activity remained stable throughout the first quarter, with over 90% of recruitment firms actively placing candidates in long-term roles. Contract and temporary roles saw more fluctuation, reflecting evolving business needs and candidate preferences.
Ireland almost at full employment
“What we’re seeing is a dynamic but tight labour market,” said Siobhán Kinsella, President of the ERF. “Recruiters are working diligently to source specialised talent, particularly in sectors like construction, nursing, software, and engineering but the appetite to hire remains resilient, even as global uncertainties loom.”
Salaries for permanent positions continue to rise, with average weekly earnings increasing by 5.6% year-on-year, underscoring the competitive landscape for talent. Recruiters also report continued demand for hybrid working arrangements, now accounting for up to 12% of vacancies, while fully remote roles have declined significantly.
Two-thirds of recruitment agencies secured at least one new client in March, although this was a slight dip from January and February levels. Meanwhile, skills shortages persist across key sectors, prompting firms to look increasingly toward international talent to fill gaps.
While the labour market remains robust, sentiment has grown more cautious. The Credit Union Consumer Sentiment Index fell to 58.7 in April, its lowest level in two years, as concerns over global economic stability and potential US tariffs weigh on Irish households. Reflecting this uncertainty, the proportion of recruiters expecting vacancies to decline in the next three months has doubled since February.
“Recruitment is a leading indicator of economic direction,” added Kinsella. “Our latest data confirms that employers are still hiring but they are becoming more measured in their outlook. Recruiters are working harder than ever to meet demand and source specialised talent in a tightening market.”
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