The latest Economic Eye report from EY - previously know as Ernst & Young - predicts that economic output here will fall for 2013 as a whole with a return to growth next year.

EY has cut its annual economic output forecast for Ireland from growth of 0.6% to a contraction in output of 0.2%. That compares with the Department of Finance forecast of 0.2% growth this year.

Weak global conditions will hurt exports and unemployment will remain at high levels in the near future, EY said in its latest research. 

For 2014 and 2015, the country's growth has also been revised down to 1.6% and 1.9% compared to previous forecasts of 2.2% and 2.6% respectively

They predict that while Irish unemployment levels remain high, they are set to stabilise in 2013 at 13.7% before modestly improving to 12.9% and 11.9% in 2014 and 2015 respectively - slightly more optimistic than its summer forecast. 

EY said it expects that current high net migration outflows will stabilise and decline gradually over the next decade, reaching zero by around 2020. 

"The Irish labour market is finally growing and, encouragingly, the growth is evident across a broad range of sectors providing confidence that the recovery will be a sustainable one," commented Neil Gibson, economic advisor to EY's Economic Eye. 

He said that the speed of recovery is still curtailed by on-going austerity and consumer confidence that, whilst improving, remains "scarred" by the events of the last five years. 
He noted that the recovery in the labour market was initially led by an increase in part-time jobs, which are now 15% higher than at the start of 2008; but more recently by an increase in full-time job numbers.

Mr Gibson said that Ireland's exit from the bailout is a further indication of how far the economy has come since the darkest days of the recession. 

"Ireland’s progress in implementing cuts and reform has been widely lauded and this only enhances an already strong international reputation," he added.