Welcome to the Moving2Ireland Jobs Market Report for December, 2019.
December is often a time to look back on your year, or decade, through a personal and professional prism. At Moving2Ireland, we feel that this an important exercise to engage in and that is why this month’s Jobs Report will examine some of the most discernible trends that we have seen in the Irish economy and jobs market during the past 12 months. Despite the sense of reflection that December brings, it is also important to remember that this month represents another key landmark in the ongoing Brexit chaos, with a UK General Election due for next Thursday, December 12. The result of this contest should determine the direction that the Brexit negotiations go in next, and may bring an end to the years of uncertainty for both the UK and Ireland.
In addition, the unemployment figures in Ireland for November remained at an almost 13 year low despite the uncertainty caused by Brexit, will this continue in December as seasonal retail positions increase, and what other industries look set for a strong finish to 2019? Let’s find out.
Ireland’s seasonally adjusted unemployment rate remained at 4.8 percent in November 2019 meaning that it remained constant with October’s figure. This month on month consistency means that Ireland has now seen it the lowest jobless rate since January 2007 in back to back months. The seasonally adjusted number of persons unemployed was 117,800 in November, an increase of 100 from October’s 117,700. When compared to November 2018, there was an annual decrease of 17,600 from 135,400.
Ireland’s unemployment rate: November 2019
Changes to Ireland’s employment permit system go live on January 1, 2020
As of January 1, 2020, a number of changes will be introduced to the Irish employment permit system. If you are from a non-EEA country and want to live and work in Ireland in 2020, then you need to pay close attention to this news.
The biggest change that will come into effect on January 1 is in terms of annual salary requirements for Critical Skills Employment Permit applicants. The minimum annual salary for Critical Skills Employment Permits will rise to EUR 32,000 for roles requiring a degree on the Critical Skills Occupation List, up from EUR 30,000 at present, while Critical Skills Employment Permit applicants who have relevant experience and whose role is not in the ineligible list of occupations will need to meet an income threshold of EUR 64,000, up from EUR 60,000 at present.
You can read more about this change and others to be enacted next month in closer detail on our dedicated article on the 2020 changes.
Paying tax in Ireland: is it a fair system?
Whether you’re an Irish citizen back at home for the Christmas period but contemplating moving permanently in 2020 or a newcomer wishing to make Ireland your new home in the next year, you’re going to need to know about the tax system in Ireland.
The first thing to know about the Irish tax system is that you will get very different answers to its fairness or severity depending on who you ask. Some people think they pay far too much tax while others feel like Ireland is quite forgiving on tax take compared to some of our European and global neighbours. But what’s the reality of the situation? As is often the case, the truth is somewhere in the middle.
In general, Ireland is regarded as having a highly progressive tax system, and that’s not just our opinion, it’s a view shared by the Irish Tax Institute. But what is a progressive tax system and what does it look like in Ireland? In layman’s terms, a progressive tax system means the more money you make, you more tax you pay. Pretty straightforward, right?
The OECD agrees with this rational and argues that Ireland is the second most progressive country for income tax among its 36 member states, and the most progressive among its EU members. So, for example, someone earning €25,000 a year would have to sacrifice €3,148 of it towards income tax and social security (PRSI) for the privilege of living here. That is the second-lowest effective tax rate after Switzerland (€2,567) among the eight countries for that lower salary level.
However, if we assess the personal tax paid by workers on a salary of €48,000, Ireland (at €12,243) leaps up the league table from second lowest to fourth highest. The UK (€11,416) and the US (€8,147), which drops to the bottom of the table, are more favorable for higher income earners but is that fair? The progressive nature of Ireland’s tax system means that those who earn more, pay more. The same cannot be said for the US where lower-income earners pay disproportionately than those on mid or higher level salaries.
The real elephant in the room is relatively scant corporation tax intake that Ireland receives from multinational companies such as Facebook, Apple and Google, but that is a topic for another day! In conclusion, if you plan on moving back to Ireland, you should be aware that Ireland’s progressive system is quite fair but could do with major improvements in terms of public services provided for said taxes.