, we expect a tightening labour market over the next few years. with that, broader - based wage growth consistent with economic fundamentals is welcome, especially as real incomes are likely to fall this year. what we will monitor closely is whether growth in wages or profits are detached from underlying productivity growth or are responding entirely to the current high rates of inflation. this would increase the likelihood that harmful higher inflation becomes embedded in the economy. the recovery in the labour market understanding developments in the labour market is key to assessing the current health of the economy more broadly as well as its likely future prospects and i will now discuss the irish labour market in more detail. 1 / 4 bis central bankers'speeches the labour market has recovered strongly in line with the rebound in economic activity from the easing of pandemic - related restrictions. in the fourth quarter of 2021, there were almost 150, 000 more people employed than pre - pandemic. this is actually above the levels of employment that we were forecasting before the pandemic in 2019. the recovery has happened at a time when the ability of people from outside ireland to come here for work has been curtailed, suggesting that new participants, who were previously resident in ireland but outside the labour force, have found employment. this is borne out in the data, which shows that employment growth is being driven by higher labour force participation, particularly for female and younger workers. forthcoming research from central bank economists analyses this somewhat surprising surge in labour force participation and whether women and younger people are entering the labour market in high numbers due to falling barriers to entry or due to more predictable cyclical and cohort effects. 6 in other words, has the increase in domestic participation occurred due to structural shifts in work patterns related to covid - 19, for example remote working, or the combination of the very strong post - pandemic economic recovery and employment expansion in jobs that typically attract younger and female workers? to try and answer these questions, our researchers have used labour market microdata provided by the central statistics office to identify the flows underpinning the changes we have seen at the aggregate level. these flows include individuals moving from outside the labour force ( inactivity ) to inside ( participation ), or from unemployed to employed or vice versa. generally, in a period of economic growth, as we have now, net flows from inactivity to the labour force would be expected to be positive, due to greater opportunities to take up a job in the economy. this

is important to note the collective commitment of supervisors in the eu to safeguard the integrity and the homogeneity of rules and our determination to avoid regulatory arbitrage. the irish financial sector is set to grow, and quite possibly to a significant extent. the central bank is committed to meeting the challenge. our workforce planning for next year reflects the additional resources needed to deal with applications that will come our way, and we have built in contingency should the need arise. as governor lane has indicated, due to an expanded universe of regulated and supervised firms, further resources are necessary, and the central bank will staff - up as required. but it ’ s important to note that the central bank no longer has a mandate to promote the development of financial services in ireland. we did have such a mandate in the past and it was judged that this compromised our authorisation and supervisory stance. there is good reason this has been removed from the act that defines our role. rather, we have a clear mandate to promote stability and protect consumers. conclusion residential mortgages, insurance and brexit have helped me to illustrate, in different but related 4 / 5 bis central bankers'speeches ways, the nature of the central bank ’ s work. our mission – to safeguard stability and protect consumers – is a wide - ranging and critical one. and in my remarks, i ’ ve tried to give a flavour of our powers under that mandate, and how we exercise them in the people ’ s interest. we are a public body. and the public is our first priority. at the end of a year such of this, it is important to convey that. citizens need to feel that public institutions are acting in their interest. more so, public institutions need to demonstrate as much. part of that process means conveying what we are and what we are not. the central bank is the monetary authority, the prudential regulator, the financial consumer protection authority, the macroprudential authority and the resolution authority of ireland. we are fully committed to fulfilling our wide - ranging duties under these mandates, while recognising that responsibility for many policies that affect the financial conditions facing households and firms lies with the oireachtas and executed by a range of state bodies. we interact, cooperate and collaborate with the relevant state agencies and a range of national and international bodies, while ensuring we both confine ourselves to our mandate while fully respecting the individual mandates of each organisation. i hope i have given you a useful