Notes On The Front

They’re Going to Let It Happen All over Again

This week the Government will launch its new housing policy.  Cliff Taylor is right:

‘It will be hard to get beyond the noise when the Government publishes its new housing plan . . . .’

We’ll have a surfeit of targets, high-sounding initiatives and policy proposals crafted with good intentions.  But the impact on the ‘market’ will be another thing.  Unforeseen and perverse consequences abound in something as complex as the housing market.

For instance, the Government’s shared equity schemes, intended to help people buy a house, will only add demand to a supply-crisis and, so, push up prices.  Landlords are reluctant to reduce rents because they don’t want to get caught by the rent-increase cap.  So they leave the accommodation empty.  Labour shortages, Brexit-fuelled shortages, higher than EU average interest rates  and time-consuming procurement process – and those are only part of the problems.

And as Eoin Burke-Kennedy reminds us, ramping up supply will not resolve Ireland’s housing crisis. 

‘The supply mantra – the notion that increasing supply is the answer to the problem – is now enshrined as an article of faith with Government, industry and much of the public . . . History unfortunately tells us [otherwise]. Ramping up housing supply has never once in our recent history improved affordability. Even at the high-water mark of construction in 2006, when a record 92,000 homes were built, property prices rose by 14 per cent.’

Yes, we need more house-building to meet future demand.  But we need a reform of the market itself or, more specifically, to create a new public housing market.  Markets are not a natural phenomenon, born from some big bang of supply and demand.  They are socially constructed.  We need new market tools; otherwise, the upward pressure on prices and rents will remain.  And whatever the progressive reforms (and there are many options), they would all lead back to a substantial and sustained public intervention based on non-speculative principles.

Here are three areas to consider. 

Unitary Rental Market

The most radical intervention in the debate over private rental accommodation and rents was NERI’s ‘Ireland’s Housing Emergency -Time for a Game Changer’ which built on the proposals by the National Economic and Social Council.  Essentially, they proposed the fusing of social housing and private rental sectors through a cost-rental model – what can be called a ‘unitary’ market. This would end the idea of social-housing-for-the-poor and replace it with a new public housing market.

Essentially, the means-test for social housing would be abolished.  The state would build affordable rental accommodation open to all applicants regardless of income or employment status.  Rents would be based on ‘cost’,  and where tenants cannot not afford the rent, they would receive a housing payment (a redesigned HAP,  but with the big difference that now these payment s would remain in the public sphere).

The distinction between the means-tested social housing sector and the wider rental market would be abolished.  The state would still build traditional ‘social housing’ targeted at groups with specific needs (e.g. the homeless, older people, tenants with disabilities, Travellers).  But otherwise, public housing would be available to all.  And the competition with traditional private rental accommodation (institutional investors, REITs,) would put downward pressure on their rents. 

The public realm becomes the main driver for affordable rents. 

Non-Speculative House Purchase Market

The state would intervene in the house purchase market through non-speculative housing.  Houses and apartments would be built and sold to first-time purchasers at cost-price.  This would open up the house purchase market to average income groups.  However, the house would remain in the public sphere.  Purchasers couldn’t sell them on the open market (to make a capital gain).  They could only sell them back to the public body that built and sold them,  based on a formula which would include original price, inflation-index and the value of any improvements. There could be limited provisions for inheritance to children who are also first-time buyers.

Climate-Proofed Housing

Rory Hearne points to the inter-related issues of housing need and climate change:

‘The housing and climate crisis are two of the main issues we have to solve . . . we have the opportunity to address the housing crisis and raise people’s living standards through improved homes, while also solving the climate crisis. It is an investment in the future of humanity. In crude accounting terms, the state will reduce costs in health spending associated with poor housing — asthma, bronchitis, mental health impacts.’

A progressive roll-out of a major retro-fitting programme would initially target the lowest income groups.   17 percent of the lowest income decile lives in pre-1918 accommodation.  A major problem is the cost.  The current grant system favours those who already have resources.  Therefore, retro-fitting should be free upfront with repayments based on income,  with the outstanding balance paid off whenever the dwelling is sold or transferred.  This allows the environmental and social benefits to start immediately. Two further steps could be made to climate-proof our housing stock:

• New houses built under new climate-proofed regulations
• Mandatory energy upgrading of second-hand houses put on the market

While these would increase the cost of housing, we need to integrate energy costs (for the household, economy and the environment) as part of a new way to assess the long-term cost of housing.  If there is a need to assist people in the market to pay for the increased upfront cost, ultra-low interest rate ‘green mortgages’ can be provided alongside market mortgages to cover the climate-proofing costs.

* * *

A unitary rental market, non-speculative house purchase market, climate-proofing market interventions – these are attempts to steer housing away from speculative and financialised activities while turning housing into an instrument of climate justice.  This requires a new public housing market while reforming the current one based on the principal of public housing for all.

However  this is done (and others will have more and better ideas),  let’s at least not be seduced by the idea that building more houses will somehow solve our underlying problems of affordability and climate protection.  Otherwise, we’ll face into what one estate agent said to Cliff Taylor:

‘They are going to let it happen all over again.’

A Sporting Economy

After the achievements at the Tokyo Olympics and the ensuing celebration at home, we now return to the hard work of putting sports at the heart of a recovery strategy.  We have a long ways to go.  Ireland is a chronic under-funder of sports and recreation activities compared to our peer EU group.

As a proportion of national income, Ireland spends less than any other EU country.  The average EU spend on sports and recreation is 0.5 percent of net national income; in Ireland it is less than 0.2 percent.  This may appear to be a marginal difference but it would mean that Ireland would have to spend an additional €500 million plus a year to reach the average.  To reach the top spender – Hungary – we’d have to spend an additional €2 billion per year.

Another perspective is the average expenditure per capita within our peer group.

Our peer group spend nearly three times more on sport and recreation than Ireland with the table topper – Sweden – spending nearly four times what we do.

According to the Eurostat classification pending on sports and recreation covers a range of activities: sporting pursuits or events, recreational facilities, passive sporting pursuits (e.g. chess), grants and loans to teams or individuals and spectator facilities. 

The Government’s National Sports Policy presents evidence that sport has a number of individual, social and economic benefits:

‘We now have a much better understanding of sport’s positive contribution to so many aspects of Irish life including health and wellbeing, social and community development, economic activity, educational performance and life-long learning.’

Such evidence includes:

• For every €100 invested by Government in sport, it received €149 in return in taxes

• Sport-related volunteering activity is estimated to have an economic value of between €322 million and €582 million annually

• ESRI research found a positive association between playing sport and Leaving Certificate performance among a sample of 1,200 students

• Research found that engagement in sport was associated with higher incomes among a sample of nearly 6,000 graduates. It also found that enterprises benefited from increased team working, communication skills, motivation, competitiveness and resilience by those engaged with sporting activity

• Research published in The Lancet in 2012 estimated that physical inactivity was responsible for 14.2 percent of all-cause mortality in Ireland. In 2014 this would translate into approximately 4,000 deaths in that year being attributable to Irish people not engaging in enough physical activity

• Physical inactivity has been estimated to cost the health budget approximately €1.5 billion per year.

The policy document found that sport also plays a role in tackling societal challenges around anti-social behaviour, particularly when offered as part of broader personal development programmes or in conjunction with community and youth services.

With all these benefits why doesn’t the government invest more in sports and recreation?  The National Sports policy promises more resources but it is extremely modest.  It proposes to increase spending on sports by a mere €100 million over the period 2018 to 2027 – a little more than an additional €10 million per year.  This will keep Ireland at the bottom of the table.

However, were we to increase sport investment we should note the flaw in the Irish model of public spending.  Like almost all other categories, Irish sports and recreation spending is highly centralised. 

• In the EU, local government accounts for 81 percent of sports and recreation spending; in Ireland, it is 26 percent.

Spending through local governments can create greater accountability and more responsiveness to local need.  This, however, is part of a larger issue with our anaemic local government structures.

Even the Government has shown the considerable benefits from increased investment and participation in sporting and recreational activities:  better health and reduced health costs, increased tax revenue, better educational outcomes, increased social interaction and reduced anti-social activities.  The good news is that investment in sport and recreation generates returns greater than the initial outlay.

Now what we need is a society-wide dialogue on where such investments should be directed:  high-performance and amateur sports, age-inclusive activities, traditional and minority sports, public facilities and affordable access to participation.

That would be a fun conversation.

Code Red for Business

It is a given that all sectors of society will have to make substantial contributions to limiting the damage of climate change – something that was driven home, yet again, by the recent International Panel  on Climate Change report.

Unfortunately, the recent report by the European Investment Bank (EIB) shows that not only is the Irish business sector not pulling its weight, it is actually dragging all of us down.

The EIB’s European Firms and Climate Change Survey 2020/2021 assesses the level of investment EU businesses have undertaken to make themselves ‘climate-ready’.  How many have assessed climate risks to their business and invested to address those risks; conducted energy audits and intend to invest in energy efficiency; have staff dedicated to increasing the company’s climate-resilience:  these are some of the questions the EIB’s survey put to over 13,000 EU businesses. 

Let’s look at some of the headline survey results before going to some practical proposals. First up, what is the percentage of companies that have ‘invested to address climate risks’?

45 percent of businesses throughout the EU have invested to address climate change.  The league leader is Finland with 62 percent.  Where’s Irish business?  At the bottom of the table, marginally above Greece: only 19 percent of Irish businesses have invested to address climate change. Whatever the reasons or excuses, this is a pretty dismal performance.

Irish business regularly features well behind the EU average in the EIB’s action-based categories. They are consistently at or near the bottom of the table. 

It is noteworthy that two-thirds of Irish firms have energy cost concerns, more than the EU average.  Yet, only a little over a third have conducted an energy audit, never mind invested in energy efficiency.  Irish business concerns don’t seem to lead to action across the board.

The EIB survey explores the reasons why businesses don’t invest – but only produce results at the EU-wide level.  So we don’t have specific data for Ireland.  Nonetheless, it can help explain the Irish deficits. 

43 percent of EU businesses stated that uncertainty about regulation and taxation was the biggest barrier to climate investment following closely by cost of investments.  While the Irish government should identify the reasons for business reluctance to invest, and do everything to help businesses overcome those barriers, we can’t rely on voluntary action or a series of carrots (usually tax subsidies).

Like so much in business life, we need a greater role for the stakeholders in putting companies on a sustainable course – whether that be environmental, social or financial.  This requires intervention tools for employees, the state and consumers.

1)  Employees:  currently, all workers are allowed to select a ‘safety representative’ to liaise with employers over health and safety issues.  Safety Representatives are entitled to carry out inspections, receive key information from the employer and receive training necessary for them to carry out their role.  This could be the basis for a new workplace innovation.

All workplaces over a certain size should be required to establish a ‘Climate Action Committee’ within the workplace with Climate Action Representatives elect on to the committee by the workforce.  This would be given a statutory basis.  It would provide for consultation on all climate-related issues.  The Government should keep a database of all representatives in order to provide information, training and allow for sharing idea on the best ways to reduce greenhouse gases.

2)  State:  the State should require all businesses over a certain size to (a) conduct regular energy audits (which could be, with additional resources, overseen by the SEI (Sustainable Energy Ireland); and (b) annually publish a Climate Audit which would, based on the energy audits, explain both what they had done over the previous year and what they intend to do in the future.

3)  Consumers:  we can use the marketplace to our advantage.  But consumer action can only be taken on the basis of information.  Therefore, the state should publish the companies’ energy audits, and the annual Climate Audits.  This would allow organisations and individuals to assess which companies are activing responsibly and sustainably and, so, base their purchase decisions on these results.

These are only some of the steps that will need to be taken to ensure a resilient business sector.  Others will no doubt have better ideas.  There will be some good ideas thrown up by this trade union initiative next month (September).

But we need to start these actions now.  As the IPCC report stated:  this is Code Red for humanity.

Democratising Entrepreneurship

Writing in the Business Post, Tom Maguire quotes a Nobel  prize-winning economist:

‘Success is achieved when the tax rules subsidise activities that benefit society as a whole more than they benefit the individuals engaging in the activities.’

Fair enough.  He also writes that we need to encourage and incentivise a thriving domestic entrepreneurial economy.  Again, fair enough.  We need new and better enterprises driving innovation, incomes, environmental sustainability and progressive working conditions.  Poorly performing, low-road businesses drag all of us down.

However, there are two issues here.  First, would expanding tax reliefs (which Maguire calls for) actually promote entrepreneurship? 

The ESRI’s recent report - ‘Options for Raising Tax Revenue in Ireland’ – touches on some of these issues.  The authors - Theano Kakoulidou and Barra Roantree – specifically look at the Entrepreneur Relief which cuts the Capital Gains Tax from 33 percent to 10 percent under certain conditions.  This is a substantial relief.   It cost the Exchequer €92 million with 875 beneficiaries - an average of a €106,000 tax break per recipient. 

The ESRI study states:

‘The justification for applying lower tax rates to people who own their own business n is far from clear. Preferential capital gains rates are often defended as essential to reward difficult and risky entrepreneurial activity . . . Evidence from the UK shows that few entrepreneurs who availed of a similar relief there knew of its existence when starting their business, and even fewer reported it having influenced the timing or nature of their disposal. This suggests that the relief is more likely to generate efforts to avoid tax on retirement than its intended purpose of spurring entrepreneurship or investment.’

That’s pretty provocative – entrepreneurial reliefs can lead to tax avoidance rather than generating new business activity.  Demands for more reliefs (i.e. cash subsides) need to provide concrete evidence that they are working.  If the ESRI analysis holds, the evidence is thin.

But Maguire cuts to an even more fundamental issue than tax efficiency.  What the heck is entrepreneurship?  There is a tendency in the public debate to mythologise or reify the ‘entrepreneur’ and, so, individualise what is actually a complex social activity.  Maguire states:

‘In essence, entrepreneurial activity is about founders getting in, staying in, and then passing the business on at the appropriate time.’

This individualised entrepreneur makes for interesting rags to riches stories, people who navigate the banks, investors and bureaucracies to bring their idea to commercial fruition.  But it is largely a myth.  Cyrine Ben-Hafaïedh notes that the hunt for the single, heroic entrepreneur was like ‘hunting the Heffalump’:

‘ . . . even when it was proven that this quest was vain, entrepreneurship scholars continued to embody entrepreneurship in a single person, a lone and heroic entrepreneur. But  . . . the 'entrepreneur' in entrepreneurship is more likely to be plural, rather than singular’.

Entrepreneurship, driving progressive business activity and innovation, is a social and collective process.  It is achieved through the cooperation between a range of people in supportive activities, both within and outside the company.  The development of new goods and services, new processes of production, emerges out of a social dynamic. 

The literature is full of studies to show that enterprise activity improves as more democracy is introduced into the workplace (here is one example from Finnish local authorities).  From consultation and information, to collective bargaining, employee participation, worker autonomy, co-determination and works councils, co-management  - all the way to labour-managed enterprises:  greater democracy and participation - leads to improved enterprise performance and innovation.  Centralised or individualised models of enterprise risk the opposite as this study shows within SMEs:

‘. . . centralized decision-making, which was found to have direct negative impact on innovation, was found to have negative impact on collaboration and communication.’

In this study, similar results showed for larger enterprises:

‘  . . . decentralization [is] positively connected to employee involvement, absorptive capacity, and firm's innovation performance. Moreover, the results show that employee involvement positively influences innovation performance . . .  The results also suggest that firm's innovation performance positively influence firm's business performance’.

If we want a ‘thriving domestic entrepreneurial economy’ we need a structural transformation that increases democratic participation within enterprises.  This transformation will vary with businesses and sectors.  But a starting point is employees’ right to collective bargaining which the OECD shows improves firm performance.  The more workers are involved, the better it is for innovation and productivity.

But it’s not just about the re-organisation of enterprises along a stakeholder model.  There are two other key elements which are briefly mentioned here:

Education:  when economists refer to the entrepreneurial skills of the labour force, they are referring to the entire population which grows business activity and value.  Education is the foundation.  Investment in education at all levels, including return to education and re-training in adult years, boosts entrepreneurship.   However, Ireland is a major education underfunder. 

We’d have to spend an additional €1.8 billion per year to reach the average of our EU peer group – other high-income EU countries.  How much entrepreneurial activity are we suppressing by under-funding education?

Second, we need new enterprise models.  Private sector business activity is only one type of activity.  We need to expand the range of models to fit the needs and preferences of entrepreneurial engagement.  Public sector models – especially local public enterprise, civil society models, certified B companies (which are legally required to consider all stakeholders, not just shareholders), labour-managed enterprises, networks of own-account workers (self-employed), etc.  This calls for a pluralist approach to business models.

This provides a different perspective and set of demands running into Budget 2022 and beyond.  What support can we provide ‘entrepreneurs’?

• Increase democracy in the workplace, starting with collective bargaining and incentivising democratic activities and structures (e.g. employee participation, works councils, co-determination, etc.)

• Increase education expenditure through a social and industrial consensus on how to best allocate that increase

• Develop new enterprise models and provide specific supports (e.g. Local Enterprise Offices to target local public enterprises, labour-managed enterprises, etc.)

This could be the start of a renewed entrepreneurial drive based on democracy, education and pluralism. 

Business in Ireland is everyone’s business.  Literally.

Reheating JobBridge

It is hard to discern the logic behind the Government’s new Work Placement Experience Programme (the WPEP). 

The WPEP is intended to provide training, education and skill development for the unemployed.   Those who have been unemployed for longer than 6 months can take up a ‘job placement’ with an employer (‘host organisation’).  The placement will last six months and participants will be paid €306 per week for 30 hours work.  Employers who participate in the scheme have to offer training but do not contribute to the pay (i.e. they get free labour).  The scheme’s aim is to give people the ‘opportunity to re-train and get experience in a new role’.

Here’s the first problem:  a business expands its payroll when they increase production of their goods or services to meet rising demand.  The Government is projecting a significant increase in a consumer-led recovery, and is projecting net new employment increases to be: 

• 2021: 79,000
• 2022: 225,000
• 2023: 75,000

Service sector companies reported the strongest month-on-month growth in business activity in July since 2000.  Given that so many businesses are ramping up production and employment to meet increasing demand, why would some employers participate in this scheme?  This is where a poorly-designed scheme can be open to abuse.

The WPEP tries to guard against abuse by laying down some conditions.  The employer:

• Must not have job vacancies in the area of activity and at the skills level the placement is offered.
• Must not have made employees redundant from similar roles in the previous 6 months.
• Cannot reduce the hours of work of existing employees to accommodate the placement.

This attempts to stop displacement of current labour.  However, it could be difficult to guard against the displacement of labour that would have been employed if the scheme had not existed.  This is called the ‘deadweight’ effect.   If an employer could not get the WPEP worker, would they have directly employed someone? 

Deadweight is not the only problem.  The scheme could incentivise poor company practices.  First, a company may try to use the scheme to undermine competitors by accessingfree labour.  After the abuse of the JobBridge scheme, companies are limited to the number of participants they can take on.  However, there is still scope to suppress payroll.  In competitive markets with tight margins, some companies may think this could give them an edge.

Secondly, it diverts managerial resources away from productive activity.  Rather than incentivising management to up their game in terms of quality, structured training, customer relations, and marketing, poor schemes merely incentivise management to expend resources on seeking state subsidies.  This will hardly create a competitive enterprise base.

The Government is hoping the scheme will increase in-work training and, so, benefit employees.  This is certainly a worthy goal.  But what is the quality of the training and jobs on offer?  It is hard to imagine six months will produce much in the way of new, enhanced skills.  Apprenticeships offer a far better route for skill development – but this takes time.  Programmes combining both classroom-based and work-based training include:

Bio-pharma * Arboriculture * Construction & Electrical * Engineering * Hairdressers * Hospitality (chefs) * Retail & Sales * Motor * Property Services * Finance & Insurance * ICT * Health * Craft butchers

These apprenticeship modules take 2 – 4 years.  This does not include other training programmes operated by SOLAS. 

The in-work training provision under the WPEP, on the other hand, looks limited.  For instance, a car washing placement offers this training:

 ‘ . . .  the participant will be trained in how to use the car washer and the different settings, i.e. wash, shampoo, rinse, wax and which solutions to be used for each cycle . . . will receive training in how to use the wet/dry vac in order to vacuum and shampoo the upholstery and interior of the vehicles . . what products to use for polishing, cleaning and buffing of the vehicle interior and exterior . . .

No doubt this is necessary to carry out car washing services.  But is this an example of what Minister Heather Humphreys called

‘ . . . innovative learning and development opportunities for participants’?

Such jobs on offer include clothes cleaning, sales assistant, kitchen cleaner (‘cleaning of dishes/utensils’), etc.  Some come with grand titles (e.g. ‘International Business Executive’). 

Particularly concerning is the use of this scheme by childcare crèches and early years services.  This is a sector plagued by low pay, precarious work conditions and high staff turnover (up to 40 percent annually).  It’s not that there is a shortage of trained staff.  Since 2010, 62,000 people have been accredited for the childcare sector but there are only approximately 25,000 actually working in the sector.  Many have left due to low-pay and precariousness.   Providing free labour for childcare and early years’ services can only increase cynicism throughout the sector (this comes from Jennifer Whitmore, TD on foot of a PQ) . 

You can review the job and training descriptions here.

There is an important role for state support for, and incentivising, in-work training.  The Department of Enterprise shows that 79 percent of Irish-owned companies that are agency-supported (essentially, export facing) spend money on ‘formal, structured’ training.  But the average spend per employee was €537 in 2019.  We shouldn’t be surprised if these figures are much lower in non-agency supported businesses – the vast majority of businesses in the state.

Such supports, just like apprenticeship and related-programmes, should require a quality rather than quantity approach.  The WPEP does not look like it fits this description.

This scheme is estimated to cost €150 million for 10,000 placements.  This looks to be of poor value – especially considering the state could employ approximately the same number for a whole year. These ‘real’ jobs could integrate training and education into socially valuable and meaningful work, especially for the long-term unemployed with stable, long-term contracts.

The Minister should stand down the Work Placement Experience Programme before too much money is misspent and focus on real training and employment quality initiatives.

We don’t need a re-heated JobBridge. 

More Bank Holidays, Please

Here’s a depressing thought:  it will be nearly three months to the next bank holiday.  This is because Ireland has few public holidays compared to other European countries. 

Calculating public holidays is not always straight-forward.  In some countries, when a public holiday falls on a Sunday, the day isn’t made up.  Some countries have religious holidays (e.g. Good Friday in Ireland) and regional holidays.  Nonetheless, Ireland fares poorly.

People Before Profit has put forward a private members bill that would introduce three new public holidays:  February 1^st, last Monday in September and last Monday in November.  This is a practical proposal to address our lack of public holidays.  But the opposition is already kicking in. Back in June Minister of State for Enterprise, Trade and Employment Damien English said an extra bank holiday could be too costly for employers who are already struggling to stay afloat.

‘Not least we would need to consider the implications and impact of any new public holiday on employment and for the economy at large, in particular the extra costs it would impose on employers already dealing with the COVID-19 crisis and Brexit.’

Would it be ‘too costly’ or even ‘costly’ at all?  There is considerable evidence that more public holidays could be economically beneficial.

• Franceso Maria Esposito finds that: ‘national holidays have a small but positive impact on economic activities or at least no effect on it . . . firms adjust their production during the year to satisfy the whole demand. Positive emotions and tourism can be other reasons which can justify the effect.’

• Joachim Merz and Lars Osberg find that: ‘Public holidays therefore have benefits both in the utility of leisure on holidays and (by enabling people to maintain social contacts more easily) in increasing the utility of leisure on normal weekdays and weekends . . . public holidays have beneficial impacts on social life on normal weekdays and weekends. Since these benefits are additional to the other benefits of holidays, it suggests that there is a case to be made for more public holidays.’

• Voxi Heinrich Amavilah finds there are small, positive economic impacts by public holidays but this is heavily caveated and tentative.

Other studies refer to the loss of production in some firms that is made up by increase in business activity in other sectors; namely, hospitality, retail, recreation, arts and leisure.  There have been some pessimistic studies.  The Centre for Economics and Business Research highlighted the negative impact of additional public holidays back in 2012 (a loss of 0.1 percent of national income per holiday).  However, they changed their mind recently, and estimated a positive impact in the UK from an additional holiday in October.

Why would there be little impact on economic output from additional public holidays?  Firms adapt and adjust their production over the year.  Further, there is the positive impact on employees’ productivity with the additional rest and relaxation – a point that proponents of the four-day working week highlight.  In any evert, even if you treat workers as just so many cogs in the production machine – well, even machines need downtime for maintenance.

However, there is another aspect which was highlighted by Brian Hayes when he was a MEP: 

‘Additional structured bank holidays can generate economic activity and jobs. The October bank holiday is the perfect example. Following its introduction we saw the growth and development of the Jazz festival in Cork and the Dublin City Marathon.’

This is a crucial observation.  Measurements to assess costs are, by their very nature, reduced to static data.  You tot up lost production on one side, gains on the othe, and then add them together to find the balance. 

What they find difficult to measure is the impact on social capital and civil society – whether that be the productivity benefit of reduced stress, management innovation, or activities that might emerge within and outside the formal market.  Activities that improve life quality have a real, if at times unmeasurable, impact on activity, especially as economies are dynamic.  White and Wynne find that:

‘One of the areas most overlooked when comparing competing metro areas is a livability factor, or quality of life, that makes certain areas more attractive to individuals and thus businesses.  One of the most often cited reasons for the location of a new business, especially a small business, is quality of life, yet it is one of the areas policymakers most often overlook in attracting entrepreneurs and the highly skilled people who most often work for them . . . Quality of life . . . can be the X factor that differentiates two competitive metro areas.’

Public holidays can add to that quality of life – not just in allowing people to have a day of doing what they want, but incentivising activities that add to increased social, cultural and ‘fun’ capital.

These are persuasive arguments for additional public holidays.  To ensure that there is no negative impact there could be a phasing-in of the holidays to allow firms to adjust – an additional holiday annually over three years.

But if we’re going down that route, can we at least call the Oireachtas back from recess for a day and introduce a public holiday in time for the end of September this year?  If we need an historical rationale we could celebrate Joe Hill’s birthday.  Ok, it’s a few days into October but who’s counting the days?