Dáil Éireann díospóireacht -
Thursday, 12 Oct 2000

Vol. 524 No. 1

Written Answers. - Job Losses.

Michael Bell

Ceist:

20 Mr. Bell asked the Tánaiste and Minister for Enterprise, Trade and Employment if her Department has undertaken or plans any study to determine the reasons for the record loss of 22,000 State funded jobs during 1999 identified in the recent Forfás report; and if she will make a statement on the matter. [21555/00]

Tánaiste and Minister for Enterprise, Trade and Employment (Ms Harney)

Job losses, whenever and wherever they occur, are of major concern to my Department and the agencies which report to it and are closely examined by those bodies as such losses can be tragic and traumatic for the individuals concerned. However, it is necessary to look at these losses in the context of the overall number of jobs created in agency assisted firms.

During 1999 there were approximately 34,600 job gains in agency assisted firms, which offset the job losses in similar firms of approximately 21,600 giving a net gain of approximately 13,000 during the year, bringing permanent full-time employment in the agency assisted company. Indeed, the figure for job gains was the highest achieved in the 1990s.

Analysis of the job losses shows that they reflect the gradual re-orientation of industry towards higher value added sectors and restruc turing in the indigenous and foreign owned industrial base in response to intense competition in both domestic and export markets. It also shows that, as a percentage of the employment base, the figure for 1999 is not far out of line with the normal pattern reaching 7.8% as opposed to the normal level of about 7%. A certain level of "job churn" is always to be expected in the economy and is not necessarily a bad thing, particularly if it leads to a shift in employment into higher productivity sectors thereby maintaining competitiveness.

For the most part, the job losses which occurred in 1999 took place in the more traditional industries, particularly consumer products, clothing and textiles. This is symptomatic of the restructuring that is taking place in industry where lower paid jobs are being replaced by higher value adding employment in higher technology areas.

In recognition of the changing global environment in which industry operates and in an effort to ensure that Irish industry remains competitive, the focus of industrial policy has shifted away from simple job creation towards raising the quality of companies and strengthening their sustainability and strategic value while ensuring that Irish firms participate fully in and benefit from the new era of e-business. Support is being focussed strongly on companies with potential for significant growth to ensure that they develop the capability across the range of business functions to sustain competitiveness and grow.

Increased output and employment now depends ever more on productivity growth. The enhancement of human resource capabilities is of strategic importance in the development and maintenance of national competitiveness and investment in training will help firms to achieve this. This will in turn help raise living standards and further enhance competitiveness turning Ireland into a high income, high productivity, high value added economy based on world class skills, technology and production systems.