Anna Pas admits it was "pretty crazy" to decide to come to Ireland just a day after she graduated from Poznan University. That was almost a year ago. Today, after a stint serving lunches at a Dublin business centre, she is editor of Polski Express.

The glossy Polish language magazine caters for the thousands of Poles who, like Ms Pas, came in the hope of a better life, after Ireland - together with UK and Sweden - opened its labour markets two years ago to workers from the 10 new accession states of the European Union.

The influx of Poles and others has been a key factor behind the continued strong growth rate of Ireland's economy, which is forecast to expand by 4.5 per cent this year, compared with 5 per cent in 2005.

But against a backdrop of unprecedented economic prosperity, which has turned a country that once exported its labour into one of the most attractive places to work in Europe, analysts now worry that most of the jobs being created are in low productivity areas such as construction.

As speculation mounts of further interest rate rises by the European Central Bank, one leading investment bank said recently that Ireland, the miracle economy of the last decade, could be "the next domino to fall".

Low interest rates have fuelled Ireland's property boom.

David Owen, chief economic research analyst of Dresdner Kleinwort Wasserstein, says he is not forecasting a full-scale recession but warns that investors are so used to Ireland outperforming the rest of the 12-nation eurozone, they may be misreading the signals.

Many in Dublin's financial community remain optimistic about the outlook. NCB, a leading stockbroker, argues that "Ireland's uniquely positive demographic profile, which has fuelled much of the country's recent prosperity, will remain a force driving strong growth for the next 15 years".

But recent data have made other economists less up-beat. Aggregate productivity rates have fallen from almost 3 per cent in the 1995-2000 period to 1.75 per cent over the past five years. The Central Bank of Ireland estimates the implied productivity rate last year, given employment increased by 4.5 per cent, was a modest 0.5 per cent.

"Growth is being achieved by strong employment gains in sectors that are experiencing little, if any, productivity growth," says David Croughan, chief economist at the Irish Business and Employers Confederation.

Economic growth achieved almost entirely by employment growth, he warns, "may ultimately result in loss of competitiveness as infrastructure bottlenecks result in lost output and inflation".

Perhaps the biggest concern is over-reliance onconstruction.

Almost 13 per cent of the workforce is in construction, compared with 8 per cent in 1997.

Ireland's dependence on construction growth makes it more like Greece, Spain or a developing economy than a high-productivity technology-driven economy likeFinland.

The construction sector is clearly very exposed to a sharp rise in mortgage rates.

The Central Bank of Ireland has said that if housing completions fell back to 2001 levels, it could reduce GDP growth by up to 0.75 of a percentage point.

Some analysts say this might even be an under-estimate if a correction in construction coincided with deterioration in theglobal backdrop, including an appreciation of theeuro and a drying up ofUS foreign direct investment.

In spite of an increase in eurozone interest rates, the housing market remains robust, rising 3.5 per cent in the first quarter - its strongest performance in six years - according to the Irish Permanent TSB bank.

"Interest rate increases should, if anything, be lowering house prices and not increasing them. It is impossible not to conclude that the probability of a bubble has increased," says Alan Barrett, senior research officer at the Economic and Social Research Institute, a Dublin based think-tank.

What is happening in construction and housing contrasts sharply with the state of the Irish export sector, which is experiencing a sharp slowdown and falling employment.

For the government of Bertie Ahern, leader of the populist Fianna Fail party, these tensions could not have come at a worse moment.

Employers and trade unions are at loggerheads over the level of a new three-year collective pay deal, which forecasters fear could make the Irish economy less competitive.

If their fears are realised, a downturn in the economy could see widescale job-losses and those sectors, such as construction, which have taken on large numbers of workers from Poland and other central European countries could be the first hit.

This would raise the question of whether the current opportunities enjoyed by Ms Pas will be available to a new generation of young Poles.