Dia dhaoibh a Chathaoirligh, a Theachtaí Dála agus a Sheanadóiri. I thank the committee for the invitation and this opportunity to speak today. I will read my three page presentation and then will be delighted to answer any questions members may have.
Innopharma Labs is an award-winning Irish technology and training company. I set up the company in 2009 after having worked in the pharmaceutical sector for ten years and then the food sector for four years. In terms of the technology side of the business, we operate a research and development budget in excess of €8 million in collaboration with multiple international academic institutions and industries. We sell these analytical technologies globally to the pharmaceutical, medical technology, food and fine chemical sectors. One of the things we do is to develop sensors and cameras that control how one binds powders together before proceeding to make tablets. We are now in more than 20 countries around the world. Earlier this year we launched our business in India and that is where we hope there will be major growth in the market for the technological side of the business over the next five years.
Education is another side of the business. We are one of this country's leading providers of innovative training programmes in the pharma, food technology and medical devices industries. We employ 27 full-time staff and more than 40 associate lecturers and industry professionals. Our courses are run nationwide in Dublin, Cork, Galway, Limerick and along the east coast.
Through the Springboard and MOMENTUM initiatives, in excess of 2,000 people have completed our upskilling and training programmes since 2010 which have focused on providing in-demand industry skills. Over 70% of participants have returned to employment within six months of completing their programme and many people have returned to employment before the six-month mark. This proves that the Innopharma Labs' specifically recruited team and jobs-centred approach works.
I will outline the opportunity for Ireland.
The economy is recovering with the private sector creating jobs. The pharmaceutical and medtech sectors never stopped creating jobs as they have been doing well even during the past five years. A gap has emerged, however, in providing the necessary qualified personnel in Ireland’s science, technology and engineering sectors, particularly the pharmaceutical, food technology and medical devices industries. Positions are, and will be, available but major companies in Ireland struggle to fill them with Irish graduates and workers at present. Attracting appropriately skilled labour into Ireland can be expensive. There is a global shortage of personnel with such STEM skill sets, and this is not confined to Ireland. I have been to India twice this year. Even India is struggling although it is producing 2.5 million science and engineering graduates every year. This is an international challenge. It is also leading to the outsourcing of some of the services that we could provide in Ireland when we are building a new pharmaceutical company or supporting an existing company in engineering facility design and start up activities. This skills deficit is a risk to the accelerated growth currently being experienced by these industries and will have an impact on future foreign direct investment decisions in the life science sector.
What I am saying is no longer news. The expert skills groups from 2013 to 2015, inclusive, have been discussing the skills gaps and have invested in upskilling programmes, such as Springboard and MOMENTUM, in these sectors. There is also a consensus that Ireland needs to increase its output of STEM graduates over the next five years. A further education and training strategy document dealing with that was published by SOLAS last year. We want to anchor our current graduates in Ireland in order to meet the needs of technology and science driven companies. We want to ensure that our third level institutions are continuing to increase the number of science, technology and engineering graduates. We need to increase the number of secondary school students who study these subjects. We need to ensure that we can attract people with those skills to return home. We need to hold on to our STEM graduates. We cannot let them go abroad unless they want to but we must ensure we have the right industries to keep them interested in staying in Ireland. Even after doing all that, we must ask how we can fill the gap that results from insufficient STEM graduates.
We must take the opportunity to upskill people from other sectors and using cross-skilling initiatives prepare them for the pharmaceutical sector. There are various ways to try to fill that skills gap. I am aware of the need to introduce an early warning system that would highlight at risk jobs, where redundancies may occur, and take the opportunity to transfer people from companies or industries that are at risk to higher value roles and-or roles where there are great opportunities for career development. We are interested in supporting such initiatives. There is a requirement to implement a nationwide approach to ensure there is a nationwide economic recovery.
Innopharma Labs proposes the expansion of an agile third level education fund that can rapidly react to industry skills needs and upskilling for the unemployed and at risk employed in Ireland through evaluating certain outcomes to ensure they meet current and future industry needs. I will outline some of the roles of this agile third level education fund. These projects should focus on enabling the long-term unemployed, particularly those under 25 years and recently unemployed, to return to work through upskilling; enabling those in at risk or in low-paid sectors to cross-skill to more stable and value-adding sectors; increasing the number of STEM based graduates and helping to meet national STEM targets through cross-skilling these at risk participants and people who are unemployed with STEM skills; enabling emigrants to return to Ireland through providing upskilling and bridging services; providing a rich supply of skill sets and human capital necessary to maintain the up-turn in high-tech manufacturing in Ireland over the next five years and beyond; and reacting to specific industry skill set needs in a rapid and flexible manner. Some components of this agile and nationwide third level upskilling are currently funded through Springboard and other similar upskilling initiatives. This could potentially continue to be the vehicle for funding such initiatives.
The jobs secured by Innopharma Labs trainees are located throughout Ireland, supporting balanced regional development. In the past year alone, more than 600 people trained by Innopharma Labs found jobs in high-end manufacturing who otherwise would have remained unemployed.
It is not just Dublin-based. As can be seen from the table, in Galway, there are well over 80 jobs, predominantly in the medtech sector. In Limerick, it was mostly medtech as well, involving mostly long-term unemployed individuals in a project we focused on there, which I will talk about later. There are 380 along the east coast from Waterford to Louth, including Dublin, in pharma, medtech, food and chemicals and, for example, Intel, which wanted to hire graduates with a good manufacturing qualification. They hire our graduates. There are food and pharma jobs in Cork. Westmeath and Roscommon, through a programme delivered in Athlone, are doing well in the medtech and pharma sectors predominantly, as are Kerry, Sligo and Mayo. Many of these 600 jobs went to jobseekers who were long-term unemployed. They would not have been filled through conventional approaches, as they were attained through a great deal of networking by our team and our graduates and support from the Innopharma Labs industry liaison team. That sounds fancy, but it involves people being on the road every day talking to companies in the pharma, medtech and food technology sectors and asking them questions such as what jobs they are hiring for, what skill gaps they have now and what skill gaps they will have next year, and whether they will consider hiring graduates from our programmes. We try to use a matchmaking process in which we engage with the industry and the graduates.
I refer to Exchequer savings to provide context and to validate the logic of the proposal. We are happy to provide detailed figures. Assuming an annual number of 10,000 students participating in upskilling, an average saving to the Exchequer per unemployed participant of €15,000 - currently the Government uses €20,000 as the calculated saving to the Exchequer when someone moves from unemployment to employment - an average annual starting salary of €30,000, or €18 per hour, which would be typical for graduates of our programmes based on these sectors, and an average worse-case cost per student to the programme of €6,000, there will be a direct net saving to the Exchequer of €120 million over five years. These are first-time graduates who do not have a third level qualification. To get people on the third level ladder and start thinking about higher-value roles is an intangible but it is important in terms of manoeuvring people who are unemployed or people who are at risk of employment in lower-value roles into higher-value roles with good career opportunities.
With student coaches supporting the participants, industry experts delivering the training, and industry liaison specialists engaging with companies on a daily basis, we have developed a tailor-made team for successful upskilling. Innopharma Labs' training programmes are designed in conjunction with industry - pharma, medtech and food companies - as well as representative bodies. This is one of the reasons behind the huge success rate for graduates in finding employment. With 70% of graduates finding employment within six months of programme completion, we are not only delivering for industry but helping to create jobs, because some of these jobs would not have been filled had our graduates and staff not been out networking and looking for opportunities. We picked an example in Limerick because it is ongoing and it is fresh in our minds. A recent upskilling programme with a focus on long-term unemployment has realised a back-to-work result of more than 70%, with graduates who were previously unemployed between 18 months and six years, some as far back as the Dell closures in 2009, now working in high-value roles within the local medtech sector in companies such as Teleflex Medical, Vistakon, Beckman Coulter and Reagecon.
Our programmes range from level 6, certificate level, all the way up to level 9, and our accreditation partners for the programmes are the Institute of Technology Tallaght, with which we have worked strongly for the past five years, and Griffith College for some of our pharma business programmes. We do a survey of industry every year and the feedback two years ago was that more graduates who were savvy in the pharma business, rather than pure technical graduates, were needed. They wanted good supervisors and managers who understood the bigger picture and could run meetings and so on.
Therefore, we developed several pharma business-type programmes in collaboration with Griffith College. From the initial programme design, student recruitment and intensive training, all the way through to taking up employment, the programmes are designed to support participants' job readiness. Work preparation, student coaching and industry engagement are integral components of the programmes.
I thank the committee for the opportunity to make this presentation. We at Innopharma Labs are very proud of what we do. Our team works really hard and it is very rewarding when we receive e-mails, as we do on a daily and weekly basis, from programme participants who were out of work for two years, for example, and have just got their first pay cheque. We have been involved in this initiative for the past five years and felt it was time to make the committee aware of our successes and explain what members are supporting on behalf of the taxpayer. Go raibh míle maith agaibh.