DUBLIN -- Ireland's economic miracle has appeared a mirage in recent days as strikes closed schools and mainline rail services, and protesting taxi drivers blockaded the streets in major cities.
Ireland has never had it so good but large sections of the work force feel the benefits of the roaring "Celtic tiger" economy have passed them by, and they are pressing for a greater share of the spoils.
Higher oil prices and currency weakness have caused a sharp rise in prices and brought industrial relations to boiling point, piling pressure on Finance Minister Charlie McCreevy as he prepares to publish his budget on December 6.
Labor costs remain low by international standards but are on the rise as unemployment falls to record lows and unions flex their muscles.
Having caught up with Europe in terms of prosperity and achieved its dream of jobs for all, Ireland is waking up to the task of ensuring boom does not turn to bust.
"We're in an absolutely new bind. A full employment economy is likely to see very substantial wage growth," said Daniel McCoy of the economic think-tank ESRI.
"If the euro turns around, we'd quickly find the exchange rate heading north, wages heading North and our competitiveness going South," he added.
Dizzying Rate of Progress Ireland has come a long way since the dark days of the 1980s when it was regarded as economically hopeless, suffering chronic unemployment and resigned to seeing its brightest and best leave for jobs in Britain or the United States.
Fuelled by huge inward investment from big multinationals, the economy has been growing at around nine percent since the mid-1990s.
This dizzying rate of progress has accelerated in recent months as the weakness of the euro helps make Irish exports even more competitive.
McCreevy's task is complicated by Ireland's membership of the new European Monetary Union, leaving him to steer a fast-moving economy through uncharted waters.
Current interest rate levels, set centrally by the European Central Bank (ECB), are way too low for Ireland.
"In some ways, we're in an extraordinary experiment -- normally the central bank would intervene to choke off the boom," said Brendan Walsh, economics professor at University College Dublin.
The new affluence is transforming society in what had long been one of Europe's poorer brethren.
Property prices have doubled as emigrants flock home, a record 100,000 new cars have hit the road in Dublin alone this year, and Irish art is fetching record prices as a new generation of high earners splashes out.
A recent study revealed that the number of people earning in excess of 75,000 Irish pounds ($80,000) grew by 50 percent over a three-year period in the late 1990s. However, average industrial earnings remain little more than 17,000 pounds.
Strikes Hit Ireland Hard The relative peace of recent years has been shattered by a debilitating series of strikes as workers seek compensation for the highest inflation levels in Europe.
Unions say workers in Ireland's large public sector have missed out on the wage gains enjoyed in dynamic sectors such as financial services and now it is time to close the gap.
Industrial unrest has seen children sent home as secondary school teachers strike in support of a 30 percent pay claim, while walk-outs by railway signal workers have paralyzed mainline train services for several days.
(Reuter)