Ireland has now recovered from the economic crash of a decade ago, according to Goodbody stockbroker's latest quarterly Irish Economy Health Check.

It is forecasting a return of domestic spending levels to their 2007 peak this year and suggests that full employment will be achieved by the end of next year.

Goodbody’s report says rapid growth in construction and consumer spending will push core domestic demand beyond previous forecasts and Ireland will retain its status as one of the fastest-growing European economies.

With jobs growing at the fastest pace since 1999, unemployment will fall to just 5% in late 2018, according to Goodbody Chief Economist Dermot O'Leary.

As a result, Ireland may need to start relying on immigrant labour to maintain its momentum as one of Europe's fastest-growing economies.

Goodbody is raising its forecasts for core domestic demand in 2017 from 3.7% to 4.5% and in 2018 from 3.6% to 4.3% as domestic spending returns to its previous 2007 peak, ending the lost decade that followed the property crash.

However, Mr O'Leary has said capacity constraints are becoming visible, especially in housing and infrastructure, meaning the Government will have to prioritise capital spending in the coming years.