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Dublin's 2025 Economy Delivers Strong Foundation for 2026 Growth
Data from the close of 2025 shows how business activity, employment peaks and housing trends set the conditions for retail spending gains and continued expansion this year.
How we reported this
Dublin's economy closed 2025 on a solid footing with business activity strengthening across services and construction. Retail spending then accelerated to nearly 3% growth in Q1 2026 and 10% year-on-year. These outcomes followed directly from the patterns recorded through the previous year.
Employment and Labor Market Shifts
Employment reached a record peak of 837,700 in Q2 2025. The unemployment rate rose to 4.9% from 4.3% in the same period, signaling a gradual cooling in the labor market. This sequence of a high employment level followed by a modest rise in joblessness forms part of the backdrop for current spending figures.
Housing Supply and Construction Trends
Housing completions rose sharply in late 2025, totaling just over 14,000 homes for the year. Housing commencements fell to 952 units in Q2 2025, marking a fourth consecutive quarter of decline. The divergence between completed units and new starts helps explain why construction activity remained visible in overall business readings even as forward momentum in housing eased.
Broader Output Measures
The Dublin Purchasing Managers' Index stood at 52.2 in Q2 2025, indicating continued but softest expansion since late 2023. Construction registered 55.8 and manufacturing 54.2, leading growth within that index. Dublin accounts for €157 billion (42%) of Ireland's GDP with a GDP per capita of $115,000 in 2025. These measures provide the scale against which the 2025 employment and housing numbers sit.
Observers will continue to track how the combination of earlier employment strength, housing completion totals and PMI readings above 50 feeds into retail performance and labor market adjustments through the remainder of 2026.