Ireland and Northern Ireland recorded similar employment growth in 2025, but significant differences in incomes, workforce participation, industrial structure and international trade continue to separate the two economies, according to a major cross-border economic study.
The Economic and Social Research Institute, or ESRI, launched the research as the first installment of a planned annual series comparing economic conditions in the two jurisdictions.
Written by ESRI researchers Alan Barrett and Adele Bergin, the study establishes a set of comparable indicators that can be followed over time rather than providing only a snapshot of the two economies.
That approach matters because headline growth figures tell only part of the story.
In the year ending in the second quarter of 2025, Ireland’s Modified Domestic Demand — a measure designed to provide a clearer picture of domestic economic activity in an economy heavily influenced by multinational companies — increased 3.2%.
Northern Ireland’s output, measured using the Northern Ireland Economic Composite Index, increased 2.8% over the same period.
Employment growth was similarly close. Ireland added 63,900 jobs, an annual increase of 2.3%, while employment in Northern Ireland increased by 20,640, or 2.5%.
The similarities largely end there.
Income and Labor Markets Reveal a Wider Divide
The ESRI’s economic comparison of Ireland and Northern Ireland found substantial differences beneath the recent growth figures.
In 2024, labor-force participation reached 78.5% in Ireland compared with 75.7% in Northern Ireland. Employment rates were 75.1% and 74.3%, respectively.
Northern Ireland had the lower unemployment rate — 1.8% compared with 4.4% in Ireland — but it also had greater economic inactivity, at 24.3% compared with 21.5%.
Living-standard measures show another divergence.
Ireland’s GNI* per capita was €63,500 in 2023, while GDP per capita in Northern Ireland was €34,500. The measures are not identical, but ESRI used them to provide a more meaningful comparison given the distortions that multinational activity can create in conventional Irish GDP.
The gap was considerably smaller for household disposable income. Equivalised disposable household income stood at €36,900 in Ireland and €33,400 in Northern Ireland in 2022, a difference of 10.4%.
Hourly earnings were 29% higher in Ireland in 2024.
The researchers also identified demographic differences. Ireland’s population expanded 14.8% between 2015 and 2024, driven substantially by net migration, compared with growth of 3.9% in Northern Ireland.
The Two Economies Are Built Differently
The study provides useful context for why economic outcomes can diverge even when short-term growth rates look similar.
Public administration, health and education account for roughly one-third of Northern Ireland employment, compared with 27.6% in Ireland.
Ireland, meanwhile, has a larger employment presence in information and communications technology — 6.4% compared with 2.8% in Northern Ireland — and financial and insurance services, at 5% versus 2.2%.
Those differences matter for productivity, wages, exports and exposure to global economic conditions.
Ireland’s large international technology sector also helps explain why developments around AI, regulation and digital investment have become increasingly important to its economic strategy. Gignomist’s coverage of Ireland’s enterprise AI ambitions and Dublin Tech Summit examines that technology-policy dimension in greater detail.
Cross-Border Trade Is Changing
One of the report’s more significant long-term findings concerns Northern Ireland’s trading relationships.
Northern Ireland exported approximately £33 billion in 2023, equivalent to 52% of its GDP. Just over half of those exports went to Great Britain, while 26% went to Ireland. The Irish share has increased considerably.
In 2015, 14.4% of Northern Ireland exports went to Ireland. That increased to 21.9% in 2022 and 26% in 2023.
Ireland’s export structure is considerably more international. Its exports were equivalent to more than 200% of GNI*, reflecting the country’s highly globalized economy and major multinational presence.
The figures illustrate why comparing the two jurisdictions requires more than putting headline GDP numbers beside one another.
Shared Challenges Remain
Despite their structural differences, the researchers found several areas where the economic priorities of the two administrations overlap.
Productivity, competitiveness and decarbonization appear in both governments’ policy programs. Both also emphasize research and development, support for small and midsize businesses and workforce skills.
The policy tools available to the two jurisdictions differ substantially, however. Ireland is a sovereign state and member of the European Union, while Northern Ireland is a devolved part of the United Kingdom with more limited control over taxation and revenue raising.
The research therefore does not suggest that policies can simply be copied from one jurisdiction to the other.
Instead, its value lies in establishing comparable evidence showing where economic outcomes converge, where they differ and where better data are still needed.
The report identifies gaps in comparable information on areas including household income, adult education, skills and services trade.
Those limitations are significant because policy comparisons are only as reliable as the underlying measurements.
The Study Has Already Entered the Policy Debate
The report was published through the joint research program between ESRI and the Shared Island Unit in Ireland’s Department of the Taoiseach. Its relevance continued after publication.
In January 2026, the Northern Ireland Assembly considered a motion centered on the report’s findings, including productivity, incomes, regional balance and the different fiscal powers available to Northern Ireland.
The study is also part of a wider debate about how economies improve productivity by combining investment, skills, technology and business development. Elsewhere in Europe, Gignomist has tracked how technology investment is concentrating around software, AI and digital infrastructure.
The ESRI series should become more useful as additional editions appear.
A single comparison can identify differences. Repeating the same exercise annually can begin to show whether those gaps are narrowing, widening or simply changing form.
That is ultimately the importance of the project: not producing another ranking of Ireland and Northern Ireland, but creating a consistent evidence base for understanding how two closely connected economies are developing on different sides of the border.
