Irish farm products are more affordable than they were in 2012

The price of the weekly shop has become a hot-button issue recently, with consumers seeing the cost of many goods rising. Latest data on grocery bills from Worldpanel by Numerator showed that grocery inflation topped an annual 6% in October.

Supermarkets have reacted to this by announcing promotions on some everyday essentials, with milk one of the most high-profile targets for savings. Data from the Central Statistics Office (CSO) shows that the price of milk had risen by more than 12% from a year earlier, so it was an obvious choice for a cut.

There are, however, different ways of measuring how much consumer essentials cost. While the price paid at the till is the obvious one, it takes no account of affordability. If someone is earning €100,000 a year, then milk at €2.45 for two litres is affordable. The same purchase for someone earning the minimum wage would be significantly less affordable.

In order to get some idea around how much more or less affordable milk has become in recent years, we looked at the historical price of two litres of milk going back to 2012 from the CSO and compared that to CSO data for average hourly earnings.

By dividing one number into the other, we can calculate how long the average worker in Ireland has to work in order to have earned enough to afford two litres of milk.

The result is perhaps surprising. In 2012 it took four minutes and 47 seconds for the average worker to earn enough to buy two litres of milk. At the end of June 2025, it took a worker on average hourly earnings four minutes and 46 seconds to earn enough to buy two litres of milk.

When it comes to affordability, the price of milk hasn’t changed at all in that 14-year period. In fact, the affordability of milk had increased between 2013 and 2021. Between those years the time taken to earn enough to afford two litres fell from just over five minutes to a low of three minutes 46 seconds.

The increase in the nominal price of milk in retail outlets since then has only been enough to bring affordability back to the level that existed 13 years ago.

It’s not just milk. In figure 2 we can see that the affordability of many food items produced in Ireland has changed little across the period. Cheese is substantially lower in terms of minutes of work needed to buy, with potatoes, sausages and beef showing little change. A pound of butter will take two more minutes of work and a kg of leg of lamb will take almost three more minutes.

The basket of goods in figure 2 took two hours and three minutes to afford in 2012 and takes one hour and 56 minutes to afford today.

For most consumers, the biggest pressure on their incomes is not the price of food at all. Generally, the cost of accommodation is the biggest monthly bill, whether that is a mortgage or rent payment.

Looking at data from the Residential Tenancies Board, we can see how much rents have increased since 2012 and how long someone on the average industrial wage has to work in order to afford a month’s rent.

In 2012, someone renting a two-bed apartment in Galway City needed to work for 33 and a half hours to afford the rent. By the first quarter of this year, the amount of time needed to afford the same apartment had risen to over 53 hours.

This means that the increase in rents between 2012 and 2025 is taking an extra half a week’s pay from a worker on the average wage, while the food they are buying is taking slightly less time than it did in 2012.

Comment

The debate around the price of food has heated up recently as consumers notice the increase in the cost of butter, milk and meat this year. However, that increase is only really noticeable to them because those prices have stayed so steady for so long.

Shoppers are used to paying a certain amount for their weekly shop, and when that goes up it is obvious to them.

Because prices were stable for a decade, they had come to expect to pay the same as they did last week, last month and last year. On the other hand, people have also become used to the price of property and rents going up year after year.

There is no expectation that a house that could be purchased for €200,000 in 2012 would be anywhere close to that price now, and that rent numbers from a decade ago would not have any relation to what is being paid now.

If you’re consuming a litre of milk a day, you will notice a price increase of 10%, but it would only amount to an extra €43 a year. If you’re paying rent of €2,000 a month, a 10% increase is almost four times that.

The debate around inflation is very important, but it is also very important that it is focussed on the things that are actually getting less affordable, rather than the things which people feel are getting less affordable.