Census 2006 shows that growth is still heavily biased towards the Dublin region, writes David Croughan
The results of the 2006 census are a further demonstration of the dynamism of the Irish economy. According to the preliminary report of the census, the population has now reached 4.235 million. We have to go back 145 years to 1861 before records show a higher population of 4.4 million.
For Ireland to truly benefit from the fruits of the very impressive growth in output and living standards which have occurred in the last decade, there must be a more even spread of that growth and population across the country. If there is not, it is sub-optimal for the regions, whose local economies are deprived of their potential to prosper and build the necessary infrastructure to attract more economic activity. It is also unhealthy for Dublin, which will lose its attractiveness and competitiveness through high levels of congestion and escalating costs.
The National Spatial Strategy (NSS), which coincidentally was published in 2002, the year of the last census, aimed over 20 years to achieve a better balance of social, economic and physical development across Ireland, supported by more effective planning. The evidence so far suggests limited success. Better balance requires that the Dublin region grows less rapidly than other parts of the country and, in turn, the regions grow more rapidly. In the period 2002 to 2006, only two gateways, or national and regional growth engines, as defined by the NSS, grew more rapidly than the national average. The first was the Dublin region, together with the extended commuter belt of Kildare, Meath, Westmeath and Wicklow, which grew by 8.3 per cent.
Whereas Dublin city and Dún Laoghaire/Rathdown recorded growth of less than 2 per cent, the extended commuter belt recorded growth rates of almost 15 per cent, with Fingal and Meath recording more than 20 per cent growth. The other was Galway city and county, which recorded a solid 10.5 per cent growth.
The remaining gateways all recorded growth rates below the national average and in particular below that of Dublin, suggesting that the regional dispersion desired is slow to gain pace. Cork's population increased by 7.4 per cent, Waterford's by 6.3 per cent and Limerick's by only 4.9 per cent.
There were divergent performances in so-called linked gateways identified in the NSS: Letterkenny rural and town, Tullamore town and district and Mullingar all recorded population increases of about 13 per cent. However, other areas focused for development fared less well: Dundalk and Athlone town and districts grew by less than 8 per cent and Sligo borough and rural increased by only just over 3 per cent.
The economy is growing more rapidly than we thought. Population and migration estimates made by the Central Statistics Office (CSO) for the three-year period up to 2005 put the annual average increase in population at 71,000; census 2006 records an annual increase of 79,000 in the four-year period 2002-2006.
Net immigration was estimated at 38,000 per annum for the three-year period ending 2005; census 2006 records an annual increase of 46,000 in the four-year period 2002-2006. From the trend in population up to 2006, the estimate of a population of 4.5 million projected for 2010 under strong growth assumptions in the NSS could well be exceeded.
One of the most striking features of the census is the dominance of net inward migration. In the period 1996-2002 the population increased by an annual average of 49,000, made up of a natural increase (births less deaths) of 23,000 and net migration of 26,000. In the most recent census, the population increased by an average 79,000 per annum, comprised of a natural increase of 33,000 and a much larger increase in net migration of 46,000.
First-quarter figures for 2006 from the Quarterly National Household Survey record that non-Irish nationals filled more than half of the 89,800 increase in employment. Immigration therefore has become an important factor in maintaining a high growth potential, supplying both skilled and unskilled labour and thus helping to contain destructive wage pressures caused by too tight a labour market.
It is the rapid acceleration in the growth of the population, with its implications for infrastructure and service provision, which requires focused policy attention.
Between 2002 and 2006, the number of people living in Ireland increased by 317,722 or 8.1 per cent; this represents a growth rate of 2 per cent per annum and compares with a growth of 1.3 per cent per annum in the previous intercensal period 1996-2002. The population of Ireland has increased by 1.6 per cent per annum in the last 10 years; in the European Union, apart from Cyprus and Luxembourg, annual population growth has been 1 per cent or less. Ireland, therefore, has to plan and cater for exceptional population pressures, with implications for housing, transport and public service provision.
The data provided by the census suggests that the strategy envisaged by the NSS is falling short of expectations and the last National Development Plan (NDP) failed to bring about the necessary development outside the Dublin area. The new NDP needs to undertake developments that will facilitate getting the NSS back on track.
The NDP must take on board the clear evidence provided by the census that growth is still heavily biased towards the Dublin region and that existing infrastructure in the greater Dublin area is insufficient to cater for further expansion of the commuter belt. In the regions, bigger urban settlements must evolve - rather than the urban sprawl evident in many major towns around the country - that will allow sufficient economies of scale to develop attractive infrastructure and services on a par with Dublin or other well-developed European cities. Without some radical thinking, there will be continuing unbalanced growth and a sub-optimally-performing economy.
David Croughan is chief economist at Ibec, the Irish Business and Employers' Confederation