Decisions made in the Budget will result in a 1.3% decline in disposable incomes for many households, the Economic and Social Research Institute said.<\/p>\n
It added that middle and higher-income households “were negatively affected by the freezing of income tax credits and bands”, as well as the withdrawal of temporary cost-of-living supports.<\/p>\n
In a new forecast, the ESRI said that the economy was growing robustly but said it expected employment would grow at a slightly slower pace with unemployment rising slightly from 4.8% this year to 5.2% in 2026.<\/p>\n
It said the domestic economy will grow by 2.1% next year compared to 4% in 2025 but said there was not an underlying slowdown but there had been a large increase in investment in 2025 which would not be repeated next year.<\/p>\n
It said Gross Domestic Product, a measure of the economy which includes the contribution from multinationals, would grow by 13.1% this year and 5.7% next year.<\/p>\n
It said this was due to a surge in exports this year before the Trump administration’s introduction of tariffs which has now begun to taper off.<\/p>\n
The ESRI has left its forecast for house completions this year unchanged at 35,000 homes and said it expects 36,000 will be built in 2026.<\/p>\n
But ESRI economist Conor O\u2019Toole said that more than 50,000 homes per annum would be needed to meet demand.<\/p>\n
The organisation has also examined the potential impact of AI the Irish economy.<\/p>\n
Mr O\u2019Toole said the risks for Ireland were larger than they were for other countries due to the presence of large multinationals here.<\/p>\n
He said companies which have made significant AI investments could use “labour replacing technologies” which could impact employment.<\/p>\n
He added that in the event of a “bubble” in AI investment bursting, retrenchment by technology companies could affect employment here and corporation tax paid by multinationals.<\/p>\n
On climate, the ESRI said there was a “decoupling” between activities and emissions in the industry sector, but there was “limited evidence” of it occurring in the transport sector.<\/p>\n
Regarding the public finances, the organisation repeated its concern about “increasing over-reliance on potentially volatile corporate tax revenues”.<\/p>\n
It also said there had been a “loosening” of the fiscal position which was “at odds with the current state of the business cycle”.<\/p>\n","protected":false},"excerpt":{"rendered":"Decisions made in the Budget will result in a 1.3% decline in disposable incomes for many households, the…\n","protected":false},"author":2,"featured_media":157678,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[72,113,61,60],"class_list":["post-197756","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-ie","tag-ireland"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/197756","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=197756"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/197756\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/157678"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=197756"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=197756"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=197756"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}