Vol. 442 No. 6
13 Mr. Gilmore asked the Minister for Tourism and Trade the total expected value of exports during 1994; if he has satisfied himself that exporting companies are making the maximum possible contribution to job creation; the plans, if any, he has to ensure that the growth in exports is more effectively translated into additional jobs; and if he will make a statement on the matter.
An Bord Tráchtála currently forecast that the total value of exports will reach £19.8 billion this year. The national development agencies, in line with Government policy, are giving top priority to maximising the contribution of exporting companies to job creation.
In so far as ABT, the national export promotion agency, is concerned, I have set it a target of helping Irish indigenous firms to increase their exports by almost 75 per cent — from £3.9 billion in 1993 to £6.8 billion — by 1999.
The fact that the indigenous exporting sector has been shown to be much more labour intensive than the multinational sector is reflected in the priority and focus accorded to this group in ABT's planned activities under the National Development Plan, 1994-1999. ABT, in co-operation with the other development agencies, will, of course, be attempting to ensure a greater transfer from export growth into employment.
Is the Minister satisfied about the reliability of the export figures in that regard? Is he telling the House that the proportion of exports by indigenous firms is £3.8 billion——
It is £3.9 billion.
It is approximately 20 per cent of the total. Does this represent a growth in total exports by the indigenous sector?
Deputy Rabbitte and I previously discussed this issue on two fronts: first, why there has not been a consequential increase in jobs and, second, the level of transfer pricing — other names are given to this practice. As Minister with responsibility for Tourism and Trade, my target is to increase exports by indigenous firms from £3.9 billion in 1993 to £6.8 billion by 1999, an increase of approximately 75 per cent. The total value of exports of £19.8 billion forecast for this year relates mainly to multinational companies. Various reports, one of which was published approximately 18 months ago, economic experts, statisticians and professors in educational institutions have addressed this issue.
I am interested in increasing the level of exports by indigenous Irish firms from £3.9 billion in 1993 to £6.8 billion by 1999. Exports account for two out of every three jobs in manufacturing and of the total of 222,000 jobs in manufacturing, 140,000 are dependent on exports. Of the 140,000 jobs dependent on exports, 98,000 or 70 per cent are in indigenous Irish companies. Exports by indigenous Irish companies account for approximately 20 per cent of total exports. Indigenous companies are much more labour intensive than multinational companies. A report published last year dealt with the extraordinary reasons as to why multinational companies cannot translate their high level of productivity in terms of exports into jobs. I am interested in indigenous industries which, as proven by these figures, can create the greatest number of jobs.
Does the Minister have any view on why the apparently very healthy export performance, which is a continuation of what has been the trend during the best part of a decade, has still not been translated into a proportionate number of jobs and why the level of industrial employment has largely remained static? If our export performance is so healthy why can we not use it to boost additional job creation?
While industrial employment has increased during the past decade, we have also lost a considerable number of jobs. Various studies by the NESC and academics have dealt with this issue. I have my own views on it, which I articulated many years ago. Many people, including the ESRI, have predicted that there will be a reasonably healthy increase in the number of people in employment during the coming years. Twelve years ago I read an obscure article on the international recession during the 1970s in which the writer asked why, after two years of growth, there had not been a consequential increase in jobs. I forget who wrote that article but he made the simple assumption that firms reduce their number of employees during a recession — for example, a company which employs, say, 300 workers will make 150 of them redundant — and they wait a long time after the recession is over before they start employing people again. In the meantime probably there may be a growth in technology resulting in higher productivity per person. As we come out of the recession, it is as good a propositional theory to advance as any I have read in the intervening 12 years. It is as sensible a suggestion as many others backed by much high falutin theory and so on. It makes as good sense to me as some other theories advanced.
The time for questions is exhausted. We come now to deal with Private Notice Questions from a number of Members to the Minister for Enterprise and Employment.
