Dáil Éireann Debate, Thursday - 26 April 2012
7Deputy Timmy Dooley asked the Minister for Jobs; Enterprise and Innovation the future he anticipates for advanced manufacturing; the steps he will take to support manufacturing; and if he will make a statement on the matter. [20927/12]
Amharc ar fhreagraIreland has built a strong reputation for quality and efficiency in a range of areas of the manufacturing sector, which employs more than 158,000 people in direct full-time jobs and the same number again in indirect employment. This sector is a key part of our economic recovery, growth and job creation strategies. Manufacturing in Ireland spans a wide range of sectors. We have particular strengths and advantages in some sectors, such as food and drink, information and communications technology hardware, medical technologies, pharmaceutical bioprocessing, engineering and industrial products, including green and cleantech products. Ireland is and can continue to be competitive in these high value manufacturing sectors, especially in terms of exports, expenditure in the economy and jobs. The manufacturing sector is increasingly dynamic, sophisticated and innovative. It invests hugely in research and development and drives productivity. It is moving further towards integrating services into its business models.
For these reasons, the action plan for jobs has a clear sectoral focus on manufacturing. It sets out a range of specific actions, to be pursued across Government in the current year, that will build on the sector's strengths and support employment growth. Challenges addressed in the action plan for jobs include issues around scale and increasing productivity, the need for specific upskilling and management development and the need to develop the sector's capacity further to engage in research, development and innovation. A key deliverable for my Department in the second quarter of this year is to articulate the Government's clear commitment to manufacturing in Ireland. The Department will elaborate on the range of initiatives and supports that are to be put in place to demonstrate this commitment. We are also committed to establishing a manufacturing development forum to assist the Government in identifying the needs of manufacturing enterprises and to progress a transformation agenda in this area.
Manufacturing, particularly advanced manufacturing, is crucial to the future of the economy. As the Minister indicated in his reply, in terms of direct employment, manufacturing is responsible for less than 10% of all employment but more than 30% of gross domestic product. I appreciate that the Government has specifically recognised the importance of manufacturing by devoting a considerable section of its action plan for jobs to the sector.
I want to ask the Minister about two specific commitments in the action plan. He will be aware a general report on future skills needs in the economy has been published. The Government has given a commitment to the production of a detailed assessment of manufacturing skills needs. It has also committed to putting in place a strategic plan for manufacturing. When can we expect those two initiatives to be taken? What is the timeline for them?
A number of immediate actions are being taken. We have commissioned a report from Forfás on the manufacturing sector which will focus specifically on the issues that have been raised by the Deputy, including future skills deficits, research and development needs and the adequacy of our technological support. When we prioritised research expenditure, we identified the segments of high value manufacturing where we believe the best opportunities lie. The Department is working with Science Foundation Ireland on the refocusing of priorities. As I mentioned in my reply, we are setting up a forum of manufacturers to work with the Government to identify the areas in which we can build and to bring to the table their experience of existing limitations. There is a sense among some manufacturers that theirs is a forgotten sector. Perhaps it was such during the boom, during which period those who would normally have gone into manufacturing entered other sectors. There is a need to refocus on manufacturing. The future skills report to which the Deputy referred identified some of the areas in which we need to develop stronger traineeships and focus on specific opportunities.
The Government has focused on particular sectors, as is proper, but, as has been said, there is a pressing need to focus on manufacturing because of its benefits. Approximately 2.5 jobs come with every manufacturing job and 0.7 jobs with every service job. The Minister referred to competitiveness being regained by the State vis-à-vis other states.
Deputy Wallace claimed the State is very much focused on computer services and pharmaceuticals with regard to exports. If these two sectors were removed, it would change the balance of payments in a massive way. The imbalance creates vulnerability for the State. We had an economy built on one sector in the past and when that sector collapsed, the economy collapsed. What strategy has the Government to ensure diversification from computer services and pharmaceuticals?
The Deputy is not correct. There are always elements of sectors that rise and fall. If the Deputy is pronouncing the end of ICT as a driver of change in our economy, I could not agree with him. The IT sector is here to stay and there are huge opportunities therein. There are massive skills shortages and job opportunities that could be availed of. The IT sector is one in which Ireland has a competitive edge, and this is recognised. We should not take the view that a sector in which we have been singularly successful is one regarding which we should get cold feet. Some of the most ambitious and exciting companies are picking Ireland as the location of preference in which to develop information technology. It is a very important sector.
The same can be said of pharmaceuticals. While products come and go and patents expire, there are considerable opportunities in the health sector. Increasingly, there is a convergence regarding pharmaceutical, medical and ICT devices. This is where we have an edge because we have strength in all the relevant sectors. There is an opportunity to future-proof all those sectors by being the test bed for the converging technologies. We have future-proofed the sectors by being at the cutting edge rather than getting nervous about the balance. I am just stating the counterargument to that of the Deputy. The sectors in question are very important to us and we have a competitive edge therein. We need to maintain and improve that edge.
Given that Ireland has, probably for the past 30 or 40 years, ignored indigenous manufacturing, will the Government now emphasise it?
Absolutely. Manufacturing comprises a sector. All the sectors have a mix of indigenous and foreign-owned companies, which is very often their strength. The medical devices sector comprises a perfect example. We have some wonderful international manufacturing companies but, equally, we have built a seedbed with NUIG around Galway that is developing many young indigenous companies at the leading edge. The mix is what really creates a cluster of strength. It is not a question of being anti-indigenous and in favour of multinationals; it is a question of balanced sectoral expansion in the relevant areas.
