A new study from the Economic and Social Research Institute (ESRI) has found that Ireland’s decade of minimum wage increases did not lead to greater job losses among low-paid workers. The research, funded by the Low Pay Commission, offers useful data for both sides of an ongoing debate, and raises a separate question about how employers are managing their wage bills.
What the Research Found
Ireland raised its minimum wage every year between 2016 and 2025. The ESRI examined whether workers on the minimum wage became unemployed in the six months following each increase. Across that period, they found no evidence that the rises made those workers more likely to lose their jobs, and larger increases didn’t change that picture either. That’s a positive finding. The risk of job losses is one of the most cited concerns around minimum wage policy, and one that employers and business groups have consistently raised. On this particular measure, over this particular period, those concerns did not materialise.
The researchers are careful to contextualise the results, noting that the period coincided with strong economic growth and low unemployment in Ireland. They acknowledge that the same policy in a weaker economic environment could produce different outcomes. It’s a fair caveat, and an important one for anyone drawing broader conclusions.
A Shift in How Employers Are Responding
The study also looked at the use of sub-minimum youth wage rates (the lower rates legally permitted for workers under 20). Currently, 19-year-olds can be paid 90% of the standard rate, 18-year-olds 80%, and those aged 17 and under 70%. Historically, these rates were rarely used. In 2019, fewer than one in five workers under 20 were paid at sub-minimum rates. By 2025, that had risen to nearly one in three. The ESRI suggests this may reflect employers using the lower youth rates to manage rising labour costs as the overall minimum wage has climbed.
That’s a practical response to a real cost pressure, and it’s legal. But it’s also a trend that the Low Pay Commission is likely to keep under review, particularly as it considers its recommendation on the 2027 minimum wage. On the positive side, young workers who age into a higher wage band don’t appear to face a heightened risk of job loss as a result of that change.
The Bigger Picture
This research doesn’t settle the debate around minimum wage policy, nor is it intended to. What it does is give policymakers, employers, and workers a clearer picture of what has actually happened in Ireland over a sustained period of wage growth.
For employers, the data suggests the labour market absorbed these increases without the widespread job losses that were feared. For workers, it confirms that pay improvements didn’t come at the cost of their employment. For policymakers, it highlights both an encouraging trend and an area that warrants ongoing attention.
The Low Pay Commission will use the findings as it prepares its 2027 recommendation to Government. Chairperson Ultan Courtney described the research as providing valuable insights, underlining the Commission’s commitment to evidence-based decision making on one of the more contentious areas of employment policy.
