Richard Eardley, regional director for Hays Montrose Ireland, said the slowing labour market reflected the downturn in the country's economic growth rate.
He said: "In the last quarter of 2001, the upward pressure on construction salaries finally eased. Employers are being a bit more cautious now that economic growth has slowed. A drop in the number of housing starts and a fall in demand for commercial property have also had an effect.
Irish salaries were unsustainable. Now growth has slowed
Richard Eardley, Hays Montrose Ireland
"Between 1999 and 2000, Irish salaries peaked at an unsustainable level. Now that wage growth has slowed. But we still have a dearth of skilled people in sectors such as civil engineering and infrastructure projects."
Neil Crossan, manager for construction for Hays Montrose Scotland, said Scottish employers' confidence levels had dropped.