Vol. 535 No. 3
1 Mr. Flanagan asked the Tánaiste and Minister for Enterprise, Trade and Employment the action she proposes to take in the matter of actual redundancies and threatened job losses in the high-tech and other industrial sectors; and if she will make a statement on the matter. [12590/01]
Job losses are of major concern to everybody and recent job loss announcements reflect the fact that, notwithstanding the success of the Irish economy, the maintenance of competitiveness remains a key challenge. The most vulnerable jobs in Ireland are those in relatively low skill areas, where openness to competitive pressures is greatest. Concentration on upskilling and retraining the workforce is essential to meet the demands of the changing environment. A primary element of current policy being implemented by the industrial development agencies is to assist companies to move up the value chain into higher skilled and better paid jobs, which should help to secure employment.
The slowdown in the US economy is having a negative impact on the overseas-owned manufacturing sector in Ireland, resulting in job losses and slowdown in recruitment and planned expansions by some major multinationals. However, the current buoyant labour market conditions in the economy mean that those losing jobs are unlikely to experience significant difficulty in finding alternative employment.
Further slowdown of the US and European economies could affect job creation prospects. The impact to date on the Irish economy in terms of growth, and employment-unemployment has been small and has been confined mainly to the information technology related sectors. IDA assisted companies in this area are relatively new and focused on higher value products, often incorporating functions such as customer-technical support, software development, and logistics, which make them less vulnerable. However, a stronger and more prolonged slowdown in the US economy would have more serious consequences for growth and employment in Ireland. It is essential, therefore, that key issues over which we have some control, and which impact significantly on the competitiveness of Ireland as a base for investment, should continue to be given priority attention and addressed. Key issues include implementing the national development plan on schedule, particularly the rollout of infrastructure into the regions, wage and price inflation, ensuring a stable industrial relations environment and adequate skills supply. The development agencies will continue to promote vigorously industrial development in unemployment blackspots throughout the country.
As regards specific company downsizing or closures, the State agencies work closely together and with local authorities and other local development interests to facilitate an integrated development approach and promote a favourable climate for business. In such cases, the attraction of replacement jobs, expansion of existing industry, provision of retraining and identification of alternative employment opportunities will continue to be high priorities.
Will the Minister accept in light of weekly announcements of actual redundancies and layoffs and threatened redundancies over a wide range of sectors but with particular reference to the high tech sector that the bubble has burst and that we have had our best years? While I accept there are many measures outside our control, what action does she propose to take to mitigate the loss to our economy? In the industries experiencing closures and cutbacks here, particularly in the high tech sector, there appears to be a change in global enterprise involving smaller highly advanced technological equipment, hand-held equipment, rather than the traditional PC equipment for which this economy has been noted in terms of our export business issue. What steps has she taken to attract the higher tech and smaller hand-held devices and equipment engaged in by some companies which are siting their euro headquarters in states other than Ireland? Has she made inquiries with a view to setting up meetings to promote Ireland as an attractive location for this type of higher technologically advanced industry?
The answer is "yes". Most of the inward investment being attracted is at the high end of the business. We have done extremely well during the past 18 months and the pipeline is good in relation to biotechnology. Most of the manufacturing of a hand-held set or a traditional PC will not be done in Ireland but elsewhere. What we offer is the higher end of the business. In the main we are attractive where a high level of research and development is involved and where high level engineering skills are required. That is the reason there has been a strong emphasis on education in recent years. At the end of this academic year in June we will have produced more IT graduates than Germany, which is a much larger country. Virtually all my overseas work with the IDA recently has been with a view to getting the higher value end of the business. There are fewer jobs but that is where Ireland is at. We are winning over 23% of the mobile investment from the US and Europe. This is the highest proportion for any country and yet we have under 1% of the European population. We must not forget we are doing extremely well. The challenge is to get some of that investment into the regions. Infrastructure has a key part to play in making the regions attractive.
We must move on to the next question.
On the question of infrastructural development in the regions the national development plan is seriously behind time and there are many targets that have not and will not be met. What steps will the Tánaiste take to ensure the national development plan is put back on the rails?
The Deputy is right in that there has been a delay regarding some aspects of the plan, in some cases for IR-related reasons and difficulties in encouraging people to change, while in other cases the planning and legal system is responsible. Yesterday the meeting of the Cabinet sub-committee on infrastructure agreed new proposals with a view to helping to fast-track some of the crucial investment needed for the national development plan.
