IRELAND’S HOUSING MARKET is “inhibiting” the country’s competitiveness and “undermining” potential for sustainable growth.

That’s according to the National Competitiveness and Productivity Council, an independent grouping which reports to the government through the Department of Enterprise.

It focuses on productivity issues facing the Irish economy and offers recommendations on policy required to enhance Ireland’s competitive position.

In its latest competitiveness bulletin, it looks at Ireland’s housing market and outlines concerns across the sector.

Addressing labour market constraints remains “crucial” for Ireland’s ability to meet targets under the government’s Housing for All programme, as well as retrofitting and emissions targets under the Climate Action Plan.

“The NCPC believes the housing market is currently inhibiting Ireland’s competitiveness performance and undermines potential improvements in sustainable growth and well-being,” it said in the bulletin.

It added that close attention should be given to the competing demands for labour across the construction sector and the impact this has on younger people competing in the housing market.

Further, the NCPC believes that “greater adoption of modern methods of construction” is crucial to reduce pressures for labour demand in the construction sector.

It said these include techniques such as off-site manufacturing and digital data management processes, which is able to “accelerate the pace of construction and enhance efficiency and quality control”, with fewer labour market constraints.

The NCPC said that while there has been a significant expansion in education and training for construction-related courses, it said it was “timely to consider whether we are striking the optimal balance when it comes to the deployment of skilled staff” in the construction sector.

It cited CSO data showing that construction sector productivity was 11% lower in 2021 than in 2011, while labour productivity in sectors “dominated by domestic enterprises increased by 9%” in the same time period.