Irish economy set to thrive, predicts government agency

Ireland Online:

The Irish economy looks set to thrive this year with many new business ventures expected to kick-off, a Government agency said today.

The Industrial Development Agency (IDA) said 2005 had been the best in terms of job creation, the range and quality of new investments and the development of research capabilities since the year 2000.

“2005 was notable for the spread of investment by multinational companies throughout the regions, and for the depth and quality of R&D investments now being won,” Sean Dorgan, chief executive of IDA Ireland, said.

“We are also confident about the prospects for 2006 as the volume and quality of new business in our pipeline is as strong as it has been at any stage in recent years.”

The number of new permanent jobs created in IDA-backed companies during the year rose to 12,605, with job losses amounting to 8,309.

The agency’s end of year review stated the net increase of 4,296 jobs was the highest number of jobs created since the year 2000.

Figures from the Department of Enterprise, Trade and Employment have shown there were over 21,500 redundancies in the first 11 months of last year, with over 40% of the jobs lost in Dublin.

The IDA said around 46 out of 71 investments by multinational companies were outside the Dublin region. Around 50 research and development projects were supported by IDA Ireland involving a total investment by business in excess of €260m – an 85% increase in value from 2004.

The figures show almost 40% of all new jobs in IDA-backed projects are worth in excess of €37,000 a year. Half of the jobs created in 2005 required third-level qualifications.

The IDA said recent announcements of job creations from Google, Wyeth Research, and financial firms including BISYS in Waterford, IFS in Drogheda and AXA in Athlone had shown Ireland had established itself as a high performance location.

The IDA said the company Sita Inc. confirmed it was expanding its software operation in Letterkenny, Co Donegal, and Zeus Industrial Products said it was opening its new European Operations Centre there.

But Donegal was also struck by some major job losses with clothing manufacturer Fruit of the Loom announcing it was laying off more than 500 Irish workers.

“The nature and the quality of investments have noticeably changed in the last year. Once we firmly placed Ireland on the world map as a knowledge economy, our challenge then was to make sure the investments we secured for Ireland would be innovation-driven, technologically advanced and with the highest calibre of employment creation,” Mr Dorgan said.

The IDA said Irish third-level graduates were a key attraction for investors and students must be encouraged, particularly in science and technology, to go on to complete Master Degrees and PhDs.

The IDA said significant investments in research and development last year included Microsoft’s establishment of a software research centre at its European operations in Sandyford.

During 2004 IDA supported companies spent €15.5bn in the Irish economy from their sales of €75bn and paid €2.5bn in corporation tax.

Enterprise Minister Micheál Martin said the range of new investments and job creation showed the Irish economy was competing remarkably strongly in the global marketplace.

“Ireland is continuing to outperform its European counterparts in terms of economic growth and development; the recent Central Statistics Office projections for future economic growth indicate that this growth is showing little sign of slowing down in the near future,” he said.

Mr Martin said the review showed efforts to ensure a balance between the capital and regional areas in terms of investment was paying off.

“Ireland is now competing for and winning world-class R&D investments. Our young highly skilled and highly educated workforce is a key component in attracting key investment. Our universities and IT’s are providing a key regional spread of graduates and post-graduates, providing a accessible pool of world class employees for multinational investors,” he said.

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