Groundbreaking new study highlights All-Island Labour Market challenges and opportunities

A comprehensive new study examining the all-island labour market has been published.

Commissioned by the Labour Employer and Economic Forum (LEEF) Shared Island Working Group, the study examines the current conditions of the island of Ireland labour market, and challenges and opportunities for effective operation for workers and businesses across the island.

This is an in-depth assessment of what it means to live, work, and employ people across the border between Ireland and Northern Ireland.

The study aims to provide an evidence base that will inform and contribute to public and political discussion on addressing challenges and enhancing opportunities for workers, businesses and the wider economy while aligning with the objective of the Good Friday Agreement to enhance cooperation, connection, and mutual understanding on the island.

The report notes that the Common Travel Area (CTA) should provide the basis for a successful all-island labour market but finds that in practice it can be exceptionally complex. The current rules and regulations, and their practical application, need to be assessed to ensure that they do in fact support the free movement of workers between the jurisdictions. Further, the ability of non-Irish and non-UK residents to work on a cross-border basis will also be a critical consideration in what constitutes the all-island labour market going forward.

“With increasingly interconnected economies and more extensive opportunities to work together, it is vital that we consider our labour market from an all-island perspective,” said Maureen O’Reilly, Economist, and co-author.

“This study highlights the significant cross-border challenges encountered by employers and workers across the island and suggests that greater clarity and collaboration is needed to maximise the opportunities that the labour market can offer for economic growth.”

The study offers actionable insights for policymakers, businesses, and cross-border workers, across a range of areas including taxation, pensions, social security, mobility of workers, skills and qualifications, collective bargaining and trade union coverage.

Rose Tierney, dual qualified Chartered Tax Adviser and Chartered Accountant in both the UK and Ireland, and co-author, said “Small businesses and cross-border employers must comply with complex taxation rules designed for large, international operations. For workers who live on one side of the border on this island and work for an employer on the other side, the complexity of dual payroll and the lack of pension tax relief are difficult and costly for both employers and employees to navigate.

“It was helpful to discover that other border regions have moved ahead with bilateral agreements that significantly ease the burden on local employers while encouraging the cross-border mobility of skilled workers. This study gives hope for real progress in engaging with policymakers on both sides of the border to work through potential solutions for this island.”

The study also reflects on the normalisation of remote and flexible working patterns, which offer significant potential for economic growth, especially in rural areas.

Annmarie O’Kane, Border People project manager with the Centre for Cross Border Cooperation, and co-author stated: “The benefits of remote working cannot be overstated. However, in a cross-border context, they are often overshadowed, for both employers and employees, by significant administrative and financial challenges. As a result, businesses, reliant on the cross-border labour pool, are often unable to meet the flexible working expectations of employees. This puts cross-border businesses at a disadvantage when attempting to retain and attract skilled labour which is inextricably linked to competitiveness and business growth. Other border regions have found solutions to similar challenges and there is significant scope to learn from those experiences.”

Throughout the research period, the authors engaged with government agencies, business leaders, business representative organisations, advice providers, and cross-border workers from both sides of the border. Their input helped focus the study on the practical, lived experiences of individuals living, working and investing in the region. Their contributions often emphasised the need for shared policies and strategies that reflect the interconnected nature of the labour force they are so reliant on.

The full report is available to download here