Austin Currie
Question:106 Mr. Currie asked the Minister for Enterprise and Employment the proposals, if any, he has to assist the development of employment in the services sector; and if he will make a statement on the matter.
Written Answers. - Services Sector Employment.
My Department currently provides a range of measures aimed at improving the market share and employment levels of the services sector.
The IDA and SFADCo provides a special package of incentives and support facilities for companies involved in internationally-traded services. The incentives include employment grants, feasibility grants, capital grants, training grants and management development grants. Equity investments in services firms have been an increasingly used form of support, over recent years.
The International Services Sector is one of the fastest growing areas in industry. Employment now stands at 11,369 (excluding software), an increase of more than 55 per cent over the past five years.
It is estimated that the international market for computer services will grow to over $100b in Europe by 1994. Ireland will participate in this growth.
A Strategic Review of the Software Industry in Ireland was published last October. From a base of 8,000 people employed at present, it is projected that the software industry can more than double the numbers employed by the end of this decade.
I am also considering Telemarketing and other Data Processing type operations as opportunities for enhancing employment opportunities in the services sector, on the basis of competitive telecommunications charges. The recently announced rebalancing of telephone charges will be of some assistance in this connection. Telecom Éireann and IDA have been asked by the Government to work together on the issues, such as cost and availability of leased lines, in this connection.
New technologies, new products and new projects are emerging in financial services, applications software, education, music/film, healthcare services and specialist publishing. Projects continue to emerge from indigenous sources as well as from overseas investors.
The International Services Programmes of the State agencies recognise (i) the close relationship between manufacturing and services and (ii) that the manufacturing sector is a significant driving force for employment creation in the domestic services sector. Drawing on data derived from the Irish Economy Expenditures Survey carried out annually, and in consultation with the ESRI, it has been found that in addition to the 220,000 people employed directly in manufacturing, the manufacturing sector spends £10.6 billion in the Irish economy, which in turn supports a further 160,000 first round indirect jobs in the services sector.
While employment creation in the domestic services sector is in large part dependent on the knock-on effects of the manufacturing sector, the internationally-traded services sector can play a similar role to the manufacturing sector as an engine of growth and employment creation.
Programmes are being put in place to promote job-creating projects in the priority areas of the information services, back office services, and direct marketing services.
I have mentioned education services as a rapidly growing area. Expenditure in the Irish economy rose from £5 million in 1984 to £72 million in 1990. Segments believed to offer the strongest possibility include the teaching of English as a foreign language and distance learning. A special effort is being made to develop this activity also.
While FÁS does not operate any programmes or schemes which are specifically targeted at the services sector; it does provide support by way of training programmes and employment schemes for persons interested in setting up small businesses.
The FÁS Integrated Enterprise Programme provides a range of support services including short specific training programmes, advice and finance to individuals, and also to groups, who are setting up new businesses, including services. The programme is important for enabling small services enterprises to maintain control and "good house-keeping" in their business and includes business appraisal training during which training allowances are paid, followed by technical training, income support in the form of enterprise payments through the enterprise scheme, enterprise workshops and access to business advice. The FÁS Community Enterprise Programme (which is part of the Integrated Enterprise Programme) offers community groups and co-operative groups a comprehensive package of advisory and financial assistance to help them become involved in enterprise and job-creation.
FÁS also operates an employment subsidy scheme — the employment incentive scheme — which applies to profit-making and non profit-making enterprises in all sectors with the exception of the public sector, banking, insurance, building societies and similar financial institutions.
My Department is also participating in the high level task force on jobs in services appointed by the Taoiseach which is due to produce specific proposals by the end of September, for consideration by Government, on measures to significantly increase the number of jobs in the services sector.