Young people will end up living with their parents until they are 35 unless the housing supply increases, Economic and Social Research Institute research professor John FitzGerald has said. “We need to go back to building 25,000 houses per year or all the young people will end up living with their parents until they are 35,” he said at the Trinity Economic Forum at the weekend. Prof FitzGerald drew much laughter at the forum by adding “they might not mind this, but their parents will”.
He repeated calls made by Minister for Transport Leo Varadkar last December for more housing to meet pent-up demand, saying the number of new homes being built needs to treble. The 36 months from January 2011 to December 2013 saw barely 2,000 new dwellings started in Dublin, whereas estimates suggest the capital needs that number of new homes every four months.
Prof FitzGerald said recovery in the construction industry would have a positive impact on people on the dole, especially those who don’t have an educational level above than the Leaving Certificate.
He also told the forum that emigration can have a positive effect on the economy and workforce, as Irish people tend to be homing pigeons, and research has shown they are more productive if they have worked abroad.
“People who emigrate and come back are 7 per cent more productive at work,” he said. “And I don’t mean a year spent in Australia, when I say worked abroad. Successful firms are firms where people have seen the outside world. More often management will have worked abroad.”
Former taoiseach John Bruton told the forum the optimism of Irish people that everything would be okay, meant we did not heed the warning signs of the property crash, but that this optimism is not such a bad thing.
“If humans were not optimists, they would not have taken the risks which, after much trial and error, brought about advances in technology from the earliest times, from the domestication of wild animals to the invention of the world wide web,” he said. He also called for a more powerful EU president, one that would have sweeping control over the entire union.
Mr Bruton said the fragility of the EU lies in the extent to which power has gravitated to the big member states at the expense of the common EU interest, as expressed through the Commission, Council of Ministers and Parliament.
Mr Bruton said he fears the EU and the euro will continue to be blamed for the consequences of failures of national policies, if some political restructuring to address the democratic deficit is not done.
Oxford University professor of economic history Kevin O’Rourke also stressed the importance of greater harmonisation within the EU, saying a banking union was necessary for the euro to continue. He said a common euro zone tax would also be a good idea, even though Ireland wouldn’t be keen on it.
PwC head of tax Feargal O’Rourke said the current tax system meant 21st century business models were meeting early 20th century tax models.
But he noted that if the corporate tax rate were the same as Germany’s, Google, Paypal and Facebook probably would not want to base themselves here.