Vol. 1046 No. 3
12. Deputy Louise O'Reilly asked the Minister for Enterprise, Trade and Employment for an update on the ongoing volatility in the tech sector given the slowdown in the sector as indicated by Central Statistics Office and data from the Revenue Commissioners. [51438/23]
Over the past year, there has been significant volatility in the tech sector. We have seen this in the media but we also know it ourselves. According to data from the CSO and Revenue Commissioners, the information and communications technology sector has experienced a sharp turnaround, with jobs growth swinging from 8% in December last year to 2.7% in September this year. Is it possible for the Minister to give me an update on his engagement with the sector, Enterprise Ireland and IDA Ireland regarding the tech sector?
Other Deputies are now arriving so I hope we will get to some of the questions that were skipped. I hope we will have the flexibility to return to them if Members want to.
It depends on whether people keep to the time rules.
We are not short of time given how fast we are moving through the questions.
On every side of the House.
In reply to the Deputy, I will refer to Monthly Estimates of Payroll Employees, published by the CSO, which should be read alongside the CSO's labour force survey. The latter has shown that employment in the ICT sector rose by 2.2% on a quarterly basis in the second quarter on 2023 to reach a new record high of over 174,000. We have more people employed in ICT now than we ever had. Of course, there have been some setbacks since the start of this year but there have also been strong gains at the same time.
As we all know, global economic headwinds have led to contraction for some tech clients over the past 12 months, particularly in the first quarter of the year. However, for Ireland the impacts have, in very many cases, been less significant than the global reductions announced. For those directly impacted, the Government has a range of supports in place.
At a sectoral level, IDA Ireland continues to actively support our technology base, with 320 IDA Ireland client companies employing 64,000 people in Ireland. Moreover, the commitment of technology companies to Ireland continues to be exceptionally strong as Ireland remains an attractive location of choice for companies. For example, in the past year several new investments in microelectronics and semiconductors, in cloud computing and in data storage have been announced in Ireland, including by Analog Devices, Intel, Qualcomm and AMD.
We have seen this year some to-ing and fro-ing in the sector. Certainly in the earlier part of the year, many big names internationally made decisions to reduce the numbers they were employing worldwide, having had extraordinary growth in the previous two years. That affected Ireland because many of the companies have headquarters for Europe and elsewhere in Ireland. In general, the percentages of losses in Ireland were not as high as they were globally, but they were still impactful. We know that. What is not often talked about is the number of companies taking on people in the tech sector. The vast majority of people who lost their jobs earlier this year found employment pretty quickly because of their skill set. Of course, we will continue to work with them.
The number employed in the sector might be as high as it has ever been but it is down. The Minister himself has expressed concern over volatility in the technology and communications sector. It is of concern to workers. As the Ministers said, Ireland is one of the most important technology centres in Europe.
What engagement has the Minister had with IDA Ireland and Enterprise Ireland to understand the skills profile of impacted staff and to be able to say people have actually been re-employed? Are the profiles of staff being let go shared with the client companies? Is the Government keeping track of the number of people who are gaining employment, having lost their jobs in this space? Could the Minister give me an update on his direct engagement with the sector to understand who the people are who are losing their jobs, whether they are being re-employed and how quickly.
I assure the Deputy that I speak to representatives of companies all the time. We have investment announcements all the time. I have been to the US three times this year and I suspect I will be going again early next year. The US is where most of the tech multinationals are coming from, although not all of them. We were in South Korea recently seeking to attract more tech interest and investment. Regarding some of the global giants that have been built in South Korea, we would like to see an increased footprint here in Ireland, if possible, as they seek to diversify and expand in the European market.
The way IDA Ireland works is such that it does not just bring companies into Ireland but also ensures that, when they are here, they are properly looked after and that we hear from them when they have concerns. Yesterday, I had an hour-long meeting with representatives of a very large tech company in Galway to make sure we fully understand its view on competitiveness in Ireland by comparison with other parts of the world.
Those interactions happen all the time. Later today I will visit Intel for an hour and a half or so to fully understand its perspective on competitiveness in Ireland.
The Minister will get a chance to contribute again.
My final point is that it is not true to say that fewer people are employed in tech now than there were at the start of the year. The CSO would suggest that there are more.
We are way over time.
That does not mean that we have not had significant job losses in certain companies. That is important to recognise.
I ask for co-operation on time. It is not fair that I keep interrupting but we need to let all the other speakers contribute in due course.
As the Minister said, there have been significant job losses; that is a fact. I met representatives from Intel a couple of weeks ago. While these big employers are incredibly important, the jobs that are being lost are not just in large companies but also in the smaller companies. For every job lost in those industries, there is also a knock-on consequential impact on others depending on that job, right down the chain. We know there are issues. I want to hear if the Minister is engaged specifically. In general terms, he will obviously meet many businesses, trade unions representatives, etc., in his role but is he engaged specifically with the tech sector? Is he concerned or is he content that people are being re-employed in this area? While the headwinds might be choppy and the situation might fluctuate, is he content that the job losses are not something to be overly concerned about?
The Minister has one minute.
I was and am very concerned about any job losses, which is why, at short notice at the start of the year, I went to the US to meet as many key decision-makers in some of the big tech companies as I could to really understand their mindset about what was happening. The answer we got was that the decisions they were making had very little to do with Ireland. In fact, it was nothing to do with Ireland at all. Instead, it was about reducing global headcount in many of these companies which had expanded extraordinary quickly in the previous 18 months to two years, as it happens probably too quickly during and post the Covid pandemic. Am I saying that all the announcements of job losses in the tech sector are over? We do not know that for sure. We are, of course, following the matter closely but there is also strong growth in the tech sector. For example, Apple, the largest company in the world, is continuing to recruit and take on more people.
Thank you.
It is spending a fortune on building-----
Thank you.
I met representatives of the company yesterday. It has a recruitment freeze at the moment.
No, we are over time.
We are seeing-----
I am really sorry. We are way over time.
All right.
I am going back to Question No. 10 in the name of Deputy Griffin.
10. Deputy Brendan Griffin asked the Minister for Enterprise, Trade and Employment the up-to-date position regarding the provision of a new IDA Ireland advance facility at Kerry Technology Park; the anticipated timeline for the various stages in the process of delivering the new facility; the progress made in the past three years while this Deputy has been seeking regular updates through parliamentary questions; and if he will make a statement on the matter. [51506/23]
I did not realise four questions would be skipped. I thank the Leas-Cheann Comhairle for her discretion; I appreciate it. I ask the Minister to update the House on the efforts to provide a new advance facility in Kerry Technology Park and to create jobs in County Kerry.
I thank the Deputy for the question. IDA Ireland has made considerable property investments in Kerry under its current strategy, including this year with the acquisition of over 16 ha of land at Kerry Technology Park. IDA Ireland is now working to identify a suitable site within this land bank for the construction of an advance building solution. Securing planning permission on the construction of the building will take some time such that IDA Ireland cannot outline a specific date by which the project will be completed, although it is looking to progress the project as quickly as possible. Kerry Technology Park is already home to internationally recognised companies, such as JRI America and Astellas, both companies that the Deputy will know well, I am sure. In September 2023, Astellas announced its intention to build a €330 million state-of-the-art facility to operate in the park.
Under its current strategy IDA Ireland is committed to delivering 19 advance building solutions across six regions in 15 locations, with eight buildings now complete, a further five to be on-site in 2024 and the remainder in the planning and site selection stages. IDA Ireland will continue to maintain a focus on its property portfolio in regional locations to support the project pipeline, including in Kerry, and will continue to position Kerry for vital and in-person site visits for prospective companies in 2023 and beyond.
The completion of the Macroom and Ballyvourney bypass will make a big difference in getting itineraries down into Kerry. Regarding the number of people employed in IDA Ireland companies in the south west, Cork is very dominant, having 50,000 or so people employed. We would certainly like to see more visits and announcements for Kerry, which I think can happen.
I thank the Minister for the update. When County Kerry is included with Cork city and county in those south-west figures, the lack of foreign direct investment, proportionately, in County Kerry often gets masked. It is important to acknowledge that Kerry does not punch as heavily as we should and we need to widen our economic base. We depend too much on the tourism and hospitality sector for employment in the county and we need to spread that. That is why I am raising this matter. It is important that we have a new advance facility for Tralee. I am not being cynical but I seem to have got the same answer for the last three years about the progress on this. It is a very noble ambition but I would like to see more progress on this now. I ask the Minister to apply his direct attention to this project, which would be marvellous for Tralee. Each response I have received since 2020 has more or less outlined the same level of progress, or lack thereof.
The news about Astellas and JRI America is fantastic. However, Central Pharma was the last advance facility to be announced for Tralee. Five years after that announcement, nobody is working in that building in Tralee. There should be up to 100 people there now. Given the amount of revenue forgone and the number of jobs forgone, the Minister needs to review that advance facility. He needs to talk to IDA Ireland about what is happening there because Tralee deserves better than that.
I would not move on that quickly from the Astellas announcement. The Deputy said he has got similar answers for some years. That is a really significant delivery for Kerry. It is a €330 million advance manufacturing facility for a big global name. It will employ a significant number of people in Kerry and specifically Tralee. That announcement happened in September, which is only a couple of months ago. I take the point, which is a fair one, that when we talk about the number of IDA-backed companies and the number of people employed by those companies in the south west, that sometimes masks the fact that the vast majority of those jobs are in Cork rather than Kerry. Historically, there is a series of reasons that is the case, such as international connectivity, roads, access issues, university presence and so on.
Thank you.
Much of that has changed under this Government.
Thank you.
We have a new technological university and a new road into Kerry.
The Minister will get a chance to come back again.
We are starting to see some of the results now with, for example, Astellas.
The news about Astellas is fantastic. I look out my kitchen window every morning at Astellas across Castlemaine Harbour. The fact that it will now also locate in Tralee is fantastic news for the county.
I will point out three things to the Minister. First, the previous advance facility has not worked to date. Nobody has worked in that site to date and no one is working there this morning. The Minister needs to revisit that because it is not good enough. A significant amount of Exchequer funding was put in to developing the facility and we do not have the levels of employment we should have in that facility to date. There needs to be serious interaction between IDA Ireland, the Minister and the company in question to get people working there.
Second, we need progress on the second promised advance facility for Kerry Technology Park. As I said, I have been getting the same answers for the past three years and I am not seeing any progress.
Third, there needs to be consideration for a new advance facility in the south of the county, particularly in the Killarney area. We need to widen the economic base. We need more opportunities for people and certainly the south of the county needs that.
This Government and the previous one have tried to focus on the competitiveness proposition for Kerry.
You do not just bring multinationals in and place them where you want. They will go where they want to go and they will look at the options they have in Ireland.
It is our job to make sure we have regional development in every part of Ireland. We have set a target for IDA Ireland as regards delivery that it ensure that at least half of the companies in which it is investing and growing are outside the Dublin area. For Enterprise Ireland, at least two thirds of the Irish companies is growing and expanding must be outside the Dublin area, including places like Kerry. That is why the Government is investing in advance facilities in Kerry, has invested in a significant upgrade of the road between Cork and Kerry and has invested in MTU in order that Kerry now has its own university through a shared campus with Cork. All of that will mean more interest, more investment and more multinationals coming to Kerry over time. We have to persuade them to go there with a competitiveness proposition. I assure the Deputy that IDA Ireland is focused on doing that.
13. Deputy Ruairí Ó Murchú asked the Minister for Enterprise, Trade and Employment whether an IDA Ireland business development consultant (details supplied) has been recruited; if the Government is rethinking the role in view of the ongoing breaches of international humanitarian law and ongoing war crimes committed by Israel. [51480/23]
Will the Minister indicate if an IDA Ireland business development consultant has been recruited and if the Government is rethinking this role in view of the breaches of international humanitarian law and ongoing war crimes committed by Israel? I am referring to recruitment of an IDA Ireland business development consultant to operate in Israel. I do not have to go through what is happening to the Palestinian people at this time. The Taoiseach has said we cannot continue with trade as normal, so we have to look at those things we can deal with.
IDA Ireland’s strategy of diversifying its market reach involves broadening the geographic profile of investors. This is supported by the agency’s pathfinder model, which it has used across several territories over the past number of years and involves engaging in market business development consultants on a part-time basis in markets with business potential and in which IDA Ireland does not have a presence.
IDA Ireland successfully tendered for a part-time Israel-based business development consultant during 2021, with the contract commencing in February 2022. This contract ended 12 months later, at the end of January 2023. Following the evaluation stage of a new tender competition earlier this year, IDA Ireland was unable to conclude a contract with the successful tenderer. In the meantime, my Department has been informed that IDA Ireland has taken the operational decision to cancel this tender competition and does not envisage re-tendering for the contract any time soon.
This was a 12-month contract we had in place. IDA Ireland was doing what it is supposed to do, namely, exploring new markets. That contract ended and has not been repeated. We will obviously keep this under operational review.
I welcome that nobody is in place and we are not looking to put somebody in place in Israel. That would be anathema to the Irish people, considering the slaughter and genocide the Israelis are carrying out.
I have no difficulty with the fact that IDA Ireland has a specific work to do to engender business and business connections. However, we need to look at some of the places in the world in which we are going to operate. We know the history of Israel. Gaza is an open prison and, beyond that, there is apartheid and the annexation of land, particularly in the West Bank. That is before we even get into the ins and outs of slaughter. We need to look at how we deal with Israel. The Taoiseach spoke in relation to the Israel-EU association agreement. I am not entirely sure how we can ensure our voice is heard but we need to look at Israel's abuse of humanitarian law and how we can act on that. Can the Minister provide any information on that?
I was a foreign Minister once but I am not one at the moment. I am an enterprise Minister now. Many of the issues the Deputy has raised are foreign policy issues on which I have very strong views. However, we are dealing with questions on enterprise.
The Deputy’s comments are very one-sided in many ways. As he knows, I have been a very strong voice at a European level in relation to the rights of the Palestinian people to have a state of their own and on a two-state solution, a peace process and holding Israel to account for breaches of international law. I continue to hold all those views.
I speak in the context of the human tragedy we have seen unfold both for Israelis and Palestinians in the last number of weeks. Our focus should be on the progress we have seen over the last 48 hours in moving towards a four-day ceasefire. We should be focused on trying to make that ceasefire work, last and be extended. Ireland is doing everything we can through our voice within the European Union the United Nations and making our voice heard bilaterally, both with Palestine and Israel, to try to bring about an end to what is extraordinary human suffering. Irish people want Ireland to be vocal and active in trying to bring that to an end and the Government is using every tool we have to do so.
We need to acknowledge the suffering Israelis have endured as well as the extraordinary response to that suffering in the context of what is currently happening in Gaza. We need to call out breaches of international law, as we do. Most important, we need to bring about change through robust and good diplomacy, as we saw from the Tánaiste last week when he visited the region. We have also had that from the Taoiseach in his very clear statements in this House.
I agree with much of what the Minister said in the sense that there is huge human suffering. We need to call out breaches of international and humanitarian law by everyone who engages in them. At this point, however, we can say that the power differential between Israel and Palestine has always remained static. Israel, a nuclear power that is able to pulverise a largely civilian population, has been provided cover by a large number of people across the European Union, the United States and the western world who we consider to be our friends at times. This has been an abject failure and it will create difficulties in relation to other issues in which the West is very interested.
We need to take action, as the Minister said, and some of that will involve trade. I am very glad this particular role has not been filled. We need to look at dual-use equipment that is delivered from Ireland to Israel, particularly equipment that could be used for munitions or to facilitate genocide. That would be utterly unacceptable. We need to implement the occupied territories Bill and the Illegal Israeli Settlements Divestment Bill. That could be done before we talk about the recognition of the state of Palestine, which is a commitment in the programme for Government.
As the Deputy will know, I have discussed many of these options many times. We have taken advice from the Attorney General about what we can and cannot do. We have received very clear answers from three Attorneys General in a row in relation to the occupied territories Bill. I repeat that Ireland could decide to do things that will gain the support of this House but the question we need to ask is whether it would make a difference on the ground to Palestinians. Would it protect children, women and innocent civilians who have been caught up in this war? Those are the questions we have to keep asking ourselves. How does Ireland maximise its influence in the context of bringing about peace? How do we ensure we keep communication channels open with those who are influential in bringing about peace, including the Israeli Government? Unlike some in this Chamber who would simply cut diplomatic ties with Israel, which I believe would be a mistake, the Government is trying to engage and is having the difficult discussions that are necessary to express our concern, frustration and anxiety about what is happening.
At the same time we are trying to impact how the European Union collectively responds and how Washington can continue to be influential over what is happening in Israel. We have been engaging with the Arab world as well. That is the approach we need to continue to take and it is the approach that has managed to assist in getting many Irish people out of Gaza. I hope it is an approach that can also impact on moving away from war, violence, carnage and loss, and towards a peace process that can deliver something much better in the future.
Sometimes we need to take the first step.
14. Deputy Denis Naughten asked the Minister for Enterprise, Trade and Employment the progress he has made with Enterprise Ireland, EI, on stimulating the establishment of indigenous businesses in the renewable energy supply chain; and if he will make a statement on the matter. [51522/23]
We have ambitious plans to generate just short of 30 GW of renewable electricity off our coast, with an estimated €80 billion capital expenditure investment. What are the Government's plans to develop the necessary onshore and offshore infrastructure, including enterprise capacity to support Ireland's energy revolution?
It is 37 GW-----
I am losing track of it, even me.
-----by 2050 and it will be well over €100 billion of capital investment. The Deputy is correct that if it were 30 GW it would be about €80 billion. It costs about €3 billion per gigawatt to develop offshore. It depends on whether it is fixed or floating but that is the rough guidance figure. It is enormous expenditure and it has the potential to employ tens of thousands of people around the Irish coastline, in parts of the country that perhaps do not have this kind of industry and employment opportunity at the moment because of isolation in geographic location and so on.
The energy sector is transforming rapidly, as the Deputy suggests. Meeting our national climate targets will require a significant increase in the development rates of renewable energy, and there are opportunities for Irish industry to capitalise on this. With the support of my Department, Enterprise Ireland's sustainability department is examining emerging areas of opportunity and how best to develop Ireland's renewable energy sector as a basis for competitive advantage. Enterprise Ireland has been working on developing Irish SME capability in the offshore wind sector since 2018, and has developed an offshore wind supply chain cluster, the Gael Offshore Network. This cluster has achieved substantial growth over the past five years, with numbers increasing from approximately 40 companies in 2019 to over 90 companies today. These companies provide a range of products, services and skill sets to the offshore wind industry sector.
This work aligns with the framework for enterprise policy for the period to 2030, as outlined in the White Paper on enterprise. Actions aimed at developing indigenous supply chain capacity will be an integral part of these initiatives. The scale of Ireland's offshore wind potential offers a once in a century industrial development opportunity. My Department is leading on the development of a national industrial strategy for offshore wind, with significant involvement from El and IDA Ireland, which are contributing to industry knowledge and expertise. This strategy will aim to maximise the gain for Ireland from the current and future growth of the industry that is expected over the next 25 to 27 years. We will publish that strategy towards the end of March, just after St. Patrick's Day.
I am glad to hear that. Considering the huge job creation potential and the economic benefits of the offshore wind sector, and in the context of what the Minister has just said to me, how is Enterprise Ireland adjusting its focus to balance between aiding SMEs and exporting, and tapping into the domestic renewable energy potential? The difficulty for Enterprise Ireland is that up to now it has been primarily focused on export-driven growth. What strategies are being considered to shift attention towards existing indigenous potential, rather than solely looking at the export or high-potential start-ups? How does the Government plan to support these existing indigenous enterprises in scaling up to meet the demands of the emerging renewable sector here? What is the timeline for that?
There are a lot of questions there. Enterprise Ireland has a stable of about 4,500 companies. The Deputy is right that most of them are focused on export markets and global growth, and that is Enterprise Ireland's remit. We have seen and are seeing Enterprise Ireland develop capacity to support and service this sector. We have a unit within Enterprise Ireland that is focused on this group of about 90 companies that are developing new technologies in supply chain considerations for the scale of investment we referred to at the start of this question. It will be well over €100 billion over the next 25 to 30 years. Many of those companies, while they have the potential to service offshore wind growth in Ireland, will also be doing it outside of Ireland. That is the nature of how Enterprise Ireland works. It builds capacity, skills and know-how in order that technologies that can be applied at home are also transferable abroad.
If you look at some of the dynamic Enterprise Ireland companies that are looking at seabed surveys to choose suitable locations for fixed-bottom offshore wind turbines, for example, companies in that space are relevant to what we need to do here but they are also operating off the UK, in other parts of Europe and in other parts of the world. That is the way we should think. Irish companies should think globally at an early stage and if they can apply that technology to a significant growth sector in Ireland, that is great, but they should also be able to transfer that knowledge to other parts of the world because offshore wind is a global industry that is growing and expanding at pace. Ireland should see itself as a competitive part of that journey. The UK, for example, has ambitious offshore wind targets as well and we should see that as almost being one marketplace. We should do that whether it is in how we manage: the energy that comes on shore; the systems to store energy; seabed surveys; seabird surveys; wave height; or tidal speeds. All of these things can and should apply in Ireland but they should apply internationally as well as a potential export product.
What measures are being implemented to ensure that job creation is maximised in communities across the western seaboard and the western half of the island? How will the programmes the Minister has spoken about address the unique challenges and opportunities presented by the renewable energy sector? How is the cross-Government co-ordination going? This is one of the big concerns I have. I know the Minister will come back to me officially and tell me everything is hunky-dory but I have been on the other side of the table and I know how challenging it is to engage across various Departments. I know how frustrating it has been in getting the planning process up and running within this country, where we have had five Government Departments involved in it. My concern is that, while the Minister in isolation is committed to this and is driving this particular sector forward, this needs to be a co-ordinated strategy across Government if it is going to deliver its full potential. I have concerns with that.
I would say officially that everything is hunky-dory between the different Departments. In this case the relationships are good. There are a number of different Departments, including the Department of housing and planning, which has effectively designed and produced the Maritime Area Regulatory Authority, MARA, and An Bord Pleanála, which will soon be a planning commission, has played a role in making decisions offshore. There is a role for the Department of Transport, which needs to get port infrastructure in place quickly. The potential funding of some of that has to involve public expenditure and potentially the Department Finance. There are climate targets that need to be met, driven by the Department of climate.
My Department will be looking at the opportunities from an enterprise perspective, as well as the challenges of building this infrastructure and the employment potential. The Department of research and third-level education is looking at the skill sets. The list goes on and on. This is about reorienting the Irish economy around a different type of energy which, in my view, has enormous opportunity attached to it for the west of Ireland, in particular. This is particularly true post 2030 but there is also some opportunity before 2030, which is why the Shannon Estuary task force has contributed significantly to that and to other aspirations on the west coast. There is, therefore, much opportunity there and we are working hard to make sure we co-ordinate it all.
