Written answers

Wednesday, 13 November 2013

Department of Finance

Job Creation Data

Photo of Lucinda CreightonLucinda Creighton (Dublin South East, Independent)
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47. To ask the Minister for Finance if he is able to track the number of jobs that can be attributed to measures introduced as a result of the Jobs initiative and put a single estimated figure on the total number of jobs created to date as a result of these measures; if he can detail such a figure; the total number of persons employed, broken down between full time and part-time employment, for each year between 2007 and 2013 to date who are earning under €356 a week; and if he will make a statement on the matter. [48412/13]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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As part of the Programme for Government, the May 2011 Jobs Initiative introduced a number of measures designed to support the creation of employment. Since Q3 2011, net employment has increased by some 27,800. A number of measures were introduced under the Initiative including the introduction of the reduced VAT rate of 9% on tourism-related services. Measures to reduce the cost to employers of taking on new employees included a halving in the lower rate of Class A employer PRSI from 8.5% to 4¼% on jobs paying up to €356 per week (€18,523 annually) to apply between July 2011 and the end December 2013.

I am advised by the Revenue Commissioners that the estimated numbers of income earners whose main source of income is taxable under the PAYE system and whose annual gross income is less than €18,512, are set out as follows for tax years 2007 to 2013 inclusive.

Tax Year
2007
2008
2009
2010
2011
2012e
2013e
Numbers (000s)
773
716
658
644
612
644
642

Source: Revenue Commissioners.

Estimated numbers are rounded to the nearest one thousand.

It should be noted that Gross Income referred to above is as defined in Revenue Statistical Reports. It should also be noted that a married couple who has elected or has been deemed to have elected for joint assessment is counted as one tax unit in these figures.

The numbers for tax years 2012 and 2013 are estimates from the Revenue tax-forecasting model using actual data for the year 2011 adjusted as necessary for income and employment trends in the interim. These figures are, therefore, provisional and likely to be revised .

The estimated numbers provided above include both full-time and part-time earners. Revenue income statistics are compiled on an annual basis and include incomes that were earned over a period of less than a year. It is not possible to distinguish the numbers in employment between those in full-time employment and those in part-time employment.

In relation to the reduced VAT rate, between Q3 2011 and Q2 2013 the numbers employed in the accommodation and food services sector have increased by 11,800 (10%) with a sizeable portion of this related to the reduced VAT rate. Work published by my Department found that in year-on-year terms, compared with a range of counterfactuals there was a net employment growth differential of 8-9% in this sector between Q2 2011 and Q2 2012 since the introduction of the reduced rate (MTFS, November 2012). A July 2013 Deloitte Report prepared for Bord Fáilte found the total increase in jobs following the VAT reduction could be estimated at c.10,000. The Initiative also provided additional public capital investment of some €109 million targeted specifically towards schools, local and regional roads and national energy retrofitting. Estimates suggest that between 8 and 12 jobs are created directly for every € 1 million in additional capital expenditure, indicating these measures alone directly supported the creation of over 1,000 jobs. Jobs Initiative measures also served to support on-going improvements in labour cost competitiveness, a feature supportive of the labour market recovery we are now evidencing.

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