The galloping horses of the Irish economy; house price growth, inflation and high-tech and professional services wage rises, are moving so swiftly old assumptions of being a “high earner” are being trampled.
We have arrived at a situation where some people with gross incomes up to €85,000 may qualify to apply for a cost rental property, which are State-supported developments where rents must be at least 25 per cent below market level.
In 2024, the general election manifestos of Sinn Féin, Social Democrats and Labour Party suggested restricting tax credits for those earning over €100,000, as part of their plans to tax those with higher incomes and wealth
Using this example, the gap between those eligible for some State supports and those considered a high earner - in this view of these parties - is €15,000.
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Since 2013, Irish house prices have doubled, far out stripping wages. Inflation between 2013 and 2024 has seen average prices rise by a quarter with much of that increase in recent years, with food and energy prices particularly impacted.
Meanwhile, within the multinational sector, average wages have risen by north of 60 per cent.
The confluence of these forces is changing the dynamic between earnings and living standards remarkably quickly.
In his column this weekend, Cliff Taylor looks at one group in the epicentre of these changes, the squeezed middle, those people “who feel they pay for everything and get little back in return”.
[ Have Irish property prices reached their peak? Five experts give their takeOpens in new window ]
A broad church, this group includes bringing up kids and looking after older parents. It also includes high earning but not yet wealthy younger people and the squeezed middle is mainly urban, middle-ground. Their key characteristic is they feel they are missing out on the gains of economic growth.
As Taylor notes “this concept of the “squeezed middle” in the Irish housing market was identified by the Commission on Housing, whose 2024 report put it as applying roughly to households earning between €40,000 and €90,000”.
By this measure they were too well off to apply for social housing, but not earning enough to survive in the private market. Many are also battling significant childcare costs too.
The Commission found this group has “the greatest potential for being left out of access to home ownership given income levels, current housing supports and delivery costs for new housing”.
Taylor notes that “based on income around one million earners – including single people and couples jointly assessed – are in that group in terms of income, though of course many will already be owning or renting”.
“A report this week from the Society of Chartered Surveyors Ireland (SCSI) found a similar phenomenon when you do the sums today for the apartment market, with affordability continuing to worsen and salaries north of €108,000 required to be able to afford to buy most apartments.”
As a result, according to Taylor, this leaves the majority of earners locked out of the apartment market in terms of buying and only the top 20 per cent earning enough to rent.
[ What does the housing market have in store in 2026? Property experts weigh inOpens in new window ]
These pressures are not unique to Ireland, even if particularly acute here. “Across Europe house prices and rents have raced ahead in advance of income growth and new supply has not responded quickly enough,” Taylor writes.
Along with earning too much to qualify for social housing, as Taylor notes “middle earners do not receive many of the supports available to the less well-off, such as medical cards, welfare payments”.
How to support this cohort and prevent them becoming disaffected is a key challenge for the Government parties during its term, not least given the multivariate pressures this group faces.
The Coalition are likely to need something more creative than tax cuts in the run up to the next general election.
David Labanyi
Head of Audience
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