Ireland’s Economic Future: Key Insights from the OECD Economic Survey 2025

The Organisation for Economic Co-operation and Development (OECD) has released its 2025 Economic Survey of Ireland, detailing a comprehensive analysis of the nation's economic performance and offering policy recommendations to enhance resilience and living standards. The OECD's 2025 Economic Survey of Ireland serves as a crucial resource for policymakers, offering insights and recommendations to navigate current challenges and capitalise on future opportunities.

 

Economic Performance and Outlook

The OECD note that despite volatility in GDP figures, largely due to multinational-dominated sectors, Ireland's domestic economy remains robust. The OECD projects real GDP growth of 3.7 per cent in 2025 and another 3.5 per cent in 2026. Inflation is expected to steady, with headline consumer price inflation around 1.8 period during this period.

Key Challenges

The survey identifies several areas requiring attention:

• Housing: A shortage of affordable housing continues to pose significant and serious challenges. The OECD recommends increasing housing supply and implementing reforms to reduce regulatory and legal obstacles, thereby lowering transaction costs and uncertainty.

• Public Finances: While Ireland's fiscal position is currently strong, long-term pressures from an ageing demographic, healthcare needs, housing, and climate change will necessitate prudent fiscal management in order to mitigate potential vulnerabilities.

• Labour and Skills Shortages: For Ireland to maintain competitiveness, it will be essential that labour and skills shortages are addressed. The OECD suggests reducing legal costs and easing administrative burdens on businesses to foster a more conducive environment for growth.

OECD Policy Recommendations

The OECD advises that if Ireland is to bolster economic resilience and improve living standards, then it must:

• Enhance Housing Affordability: Implement policies aimed at increasing the housing supply and making it more affordable.

• Strengthen Public Finances: Adopt measures to reduce public finance vulnerabilities, ensuring long-term sustainability.

• Improve Business Competitiveness: Reduce legal costs and administrative burdens to help businesses thrive and address labour market shortages.

A New Social Contract needed if Ireland is to deliver on these recommendations

Social Justice Ireland makes proposals that would see public policy focused on simultaneously delivering five outcomes as part of a new social contract: a vibrant economy; decent infrastructure and services; just taxation; good governance; and sustainability. Managing change effectively will allow us to harness the benefits of transition to transform both our society and our economy. All of this will require new approaches to the world of work as well as recognition of much of the work done in society that goes unpaid, under-recognised and undervalued. It will also require recognition that our tax and welfare systems are not fit for purpose in the twenty-first century.

A new social contract will also require that climate action be urgently prioritised; to date the policy response has been wholly inadequate. The same can be said of the ineffectual response to the current housing crisis. Investment in infrastructure and services is needed to develop a thriving economy. Likewise, just taxation is required to fund this. Good governance is needed to ensure people have a say in shaping the decisions that impact them. Finally, all Government policy must be sustainable; environmentally, economically and socially. Ultimately only social justice and the wellbeing of everybody in our country, whether born here or newly arrived, will ensure a stable, healthy, and open society. Achieving these five goals requires that we recognise that it is time for a new approach if we are to manage these transitions and deliver change.