Economic growth will fall next year, according to employers' body IBEC, which says that the building boom is masking weak performances in other key sectors.
Chief economist Mr David Croughan said yesterday that gross national product (GNP) - which excludes exported multi-national profits - would grow by 4.8 per cent this year.
However, he warned that a slowdown in the housebuilding boom and ongoing sluggishness in some domestic and global sectors would drag this back to 4.5 per cent by the end of 2005.
In the group's quarterly economic review, published yesterday, Mr Croughan says that housebuilding will be a central contributor to this year's overall economic performance.
The building industry is set to complete a record 80,000 units by the year's end. Mr Croughan believes that this performance is unlikely to be repeated in 2005. IBEC's figures show that other areas of the economy are performing poorly.
Manufacturing increased at an annual rate of 4.6 per cent in the first quarter but fell back dramatically to 2.1 per cent in the second. This left the overall increase in output at 3.3 per cent for the first six months of the year.
Underlying this, the numbers show that traditional industry has virtually stagnated since 2001. Similarly, the review points out that sectors such as computers, which helped drive manufacturing output during the boom, have struggled to shine in the last 10 years.
Specific factors have lifted other areas. Investment in plant and machinery has increased this year by 10 per cent. However, stripping out Ryanair's large order of aircraft, it comes in at less than 3 per cent.
Consumer spending has also grown sluggishly this year, and the employers' group estimates that it will be 3 per cent.
IBEC predicts that there will be an extra 35,00 people working in the economy by the end of this year, an increase of 1.8 per cent. Another 33,000 will join them by the end of 2005, its says.
IBEC's review reiterates its warning that the new Minister for Finance, Mr Cowen, should not depend on a second windfall from investigations or an increased take from stamp duty from the housing market when he is framing his first budget.
