Cost of living in Ireland

A reader requested topic

You know it’s a cost of living crisis when you only buy reduced price food. Picture credits: Paola Bassanese

This topic was requested by Life in Ireland’s subscribers. The cost of living crisis is affecting many people around the world but it seems to be hitting hard in Ireland, even though on paper it has one of the strongest economies in Europe.

Over the past few years the standard of living in Ireland has decreased, regardless of Ireland’s Gross Domestic Product (GDP) which in 2024 was estimated at around $6 billion. The World Bank released a graph showing the growth in Ireland’s GDP since the 1960s. In 2023 alone, the GDP was over $551 billion, a massive increase from 1960 when it was only $2 billion, or $3 billion in 1966, almost $22 billion in 1980 or more than $49 billion in 1990. An incredible surge in GDP started from the 2000s, with a peak in 2008 with more than $275 billion during the period that the media called the “Celtic Tiger”, only to then experience a crash during the global recession shortly afterwards. In 2010 the GDP was down to $222 billion approximately, but from 2019 onwards it has exceeded $400 billion to the present times. Not even the Covid pandemic slowed the rise in GDP, because in 2020 it was $436 billion, in 2021 $531 billion and in 2022 $548 billion.

In terms of GDP’s growth percentages, the peak was in 2015 at 24.5%.

Ireland’s statistics office CSO reported that the Gross National Income (GNI) increased to €363.6 billion; however, the GNI decreased over time as a percentage of GDP to just under 72% in 2021. This has been the result of foreign investment into the Irish economy and the presence of large multinationals that set their European offices in Ireland (e.g. Amazon, Apple, Citybank, Google, Meta, Paypal etc).

According to the CSO, Ireland in 2022 was in the 11^th place among European Union countries for GNI and at the ninth spot in terms of GDP. The GNI per capita was calculated at €52,688 in 2022. Ireland was in second place in the EU for GDP per capita in terms of Purchasing Power Standards (PPS) in 2022, with a score of 235 or 135% higher than the EU average, which on paper would indicate economic prosperity.

In reality, not many people in Ireland earn at that level or have that type of spending power, especially the younger generations. Also consider that employment rates have been slowing down to an estimated 2% in 2025.

To quote from the CSO’s website:

GDP is only an economic measurement. GDP does not tell us about the happiness, well- being or health of a country. It only measures activity that is paid for, all the voluntary activity in homes and communities is not taken into account.

Other factors that are not included in the calculations are the impact of climate change, how wealth is distributed and whether the wealth stays in the country or not when a foreign investor leaves.

KPMG expects GDP to grow at 4% in 2025.

Where does all Ireland’s wealth go?