Chief economist checks Dublin's economy today: 'Have we beaten inflation?'
There are reasons to be cautious about the economic future of the capital with approximately 60% of Dublin’s multinational corporations originating from the United States.
That’s according to Chief Economist Andrew Webb from Grant Thornton, who briefed Dublin City Council representatives on Tuesday about the economic state of the world, Ireland, and Dublin. Speaking at the Economic Development and Enterprise SPC, Mr Webb stressed that the economic uncertainty of recent years "certainly hasn't gone away” and that “the cluster of shocks feels more frequent than before."
One topic of discussion was President Donald Trump's goal of getting US companies to bring their headquarters back to the States, which would mean a significant loss of corporate tax for the Irish economy, although Mr Webb said that "Trump often doesn't follow through on the the things he threatens" and that there is usually "a softer landing" than what is suggested.
With three years remaining in Trump's Presidency, Mr Webb also believes it would take much longer than that to "unwind the interlinks" between Ireland and the US. He explained that ultimately the ambition for Ireland is to broaden the tax base "no matter who the President is."
While Mr Webb highlighted a long period of relative stability between the 2008 economic crash and Brexit in 2020, since then the World Uncertainty Index has been in flux. Contributors include the ripple effects of the pandemic , the war in Ukraine, a cost of living crisis, and the impact of President Trump’s impulsive and haphazard leadership techniques.
From surprise tariffs to the impact of a cost of living crisis, Ireland and Dublin has often been subjected to economic troubles outside of its control as geopolitical instability means investors are less willing to take risks and have a much shorter planning horizon than before. Shifts in global trade signal a new economic era that Dublin is still adapting to, although Mr Webb said the anticipation of Trump’s tariff frontloaded a lot of trade into Q1 of 2025, giving the Irish economy a bump.
Mr Webb said the key question of all of this is ‘have we beaten inflation?’ and that the short answer to this is ‘yes.’ With projected G20 headline inflation in 2025 standing at 3.4%, estimates put this at 2.8% for 2026, and 2.5% for 2027.
Although it’s important to look not just at headline inflation but how this actually translates to peoples’ experiences day-to-day. While customers might notice things like airline fares moving in the right direction, Mr. Webb said that this isn’t necessarily the case for the food in their shopping baskets at the supermarket.
Things like natural gas and crude oil prices have come down from the “dramatic peaks of the inflation period,” which Mr. Webb explained should translate to better value for people heating their homes. The construction industry has also been in flux, but steel costs are beginning to settle after being “particularly volatile” in recent years.
In terms of Dublin, employment remains strong, but Mr Webb explained that they recognise early signs of a cooling in the labour market. Job postings on Indeed are down, and factors such as the growing utilisation of AI could be having an impact on the recruitment of youths, as well as entry level and graduate positions. While there are some exceptionally strong expansions within the labour market across various industries, a slowdown in listings potentially signals a “softer patch ahead.”
Dublin’s unemployment rate reached 5.2% in late 2025. This is significant because it is the first time it has surpassed the 5% threshold since 2022. Despite this, Dublin reached a record high of 844,100 people in employment in Q3 2025 . The paradox signals that the labour force is growing faster than new roles are being created.
There are also key factors impacting the Dublin economy’s growth capacity, with housing being a prime issue. Mr Webb said that commencements have dropped off and the pipeline of supply is weakening which puts pressure on prices as Dublin’s housing market remains incredibly competitive.
Rent prices in Dublin and the "structural challenge of housing” is a “binding constraint” on competitiveness and growth according to Mr Webb. However, he stressed the key takeaway is that Dublin is doing well overall, which is often overshadowed by a ‘housing is awful’ perception.
“Dublin is performing well within tighter limits,” he said. “What happens next will be determined by our ability to address these key challenges.” However, things “outside of our control” like tariffs, geopolitical uncertainty, and war will play a role.
This content is funded by the Local Democracy Reporting Scheme