The Impact of Ireland’s Recession on the Labour Market Outcomes of its Immigrants

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In the mid-2000s, Ireland experienced a large inflow of immigrants, partly in response to strong economic growth but also in response to its decision to allow full access to its labour market when EU expansion occurred in May 2004. Between 2004 and 2007, the proportion of non-nationals living in Ireland almost doubled, increasing from 7.7 to 13.1%. Between 2008 and 2009, Ireland experienced one of the most acute downturns in economic activity in the industrialised world, with a cumulative fall in Gross National Product of close to 14%. In this article, we assess how this downturn has impacted upon the employment outcomes of non-nationals relative to natives. We find huge job losses among immigrants, with an annual rate of job loss of close to 20% in 2009, compared to 7% for natives. A higher rate of job loss for immigrants is found to remain when we control for factors such as age and education. We also show how an outflow of non-nationals is occurring. The findings have many implications. In particular, the results point to economic vulnerability for immigrants. However, they also point to a potential macroeconomic benefit to Ireland in terms of a flexible labour supply adjustment.

Source: European Journal of Population / Revue européenne de Démographie Volume 28, Issue 1, February 2012 

Author(s):Alan Barrett and Elish Kelly (ESRI)
Publication Date:16 Feb 2012
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