Priority Questions. - Job Losses.

Tuesday, 25 March 2003

Dáil Eireann Debate
Vol. 563 No. 4

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  103.  Mr. Howlin  Information on Brendan Howlin  Zoom on Brendan Howlin   asked the Tánaiste and Minister for Enterprise, Trade and Employment  Information on Mary Harney  Zoom on Mary Harney   the number of redundancies notified to her Department during 2000, 2001, 2002 and to date; the steps being taken to deal with the sharp increase in redundancies; and if she will make a statement on the matter. [8196/03]

Ms Harney: Information on Mary Harney  Zoom on Mary Harney  The numbers of redundancies notified to my Department in the years mentioned by the Deputy are 13,316 in 2000, 19,977 in 2001, 25,358 in 2002 and 4,264 up to the end of February 2003. The increase in redundancies which these figures represent must be seen in the context of the international economic environment in recent years. Even before the current uncertainties relating to Iraq, a sequence of events had acted to produce an international economic downturn, manifested in weak global demand, volatile stock markets, curtailment of investment and a fall-off in business confidence generally. Global economic conditions remained weak in 2002.

As an open economy, Ireland cannot hope to remain unaffected by events in the global market place in which it operates. The increased level of job losses occurring here is a reflection of slower economic activity experienced in Ireland in line with adverse global economic conditions.

In dealing with closures and major job losses, the State agencies under the aegis of my Department work closely with the companies affected and local interests in addressing the difficulties arising and seek alternative employment opportunities and provide training for the workers affected.

In a difficult economic environment, the IDA continues to enjoy considerable success in promoting Ireland as an investment location, with the number of new investments secured in 2002 up by two thirds on 2001. At the same time, its [750] measures to promote more high value activities by overseas companies in Ireland are bearing fruit, with companies undertaking in 2002 to invest nearly €120 million in research and development activities in their Irish operations.

Enterprise Ireland and Shannon Development are continuing to work closely with indigenous companies as they seek to minimise the negative impact of a difficult international trading environment. As well as working with existing client companies in improving their competitiveness and in developing their exports, a range of initiatives are being put in place geared towards Irish companies developing export markets for the future.

In the current global climate of major geo-political uncertainty, the Government will continue its work of addressing the factors necessary to maintain Ireland's competitive position.

Mr. Howlin: Information on Brendan Howlin  Zoom on Brendan Howlin  I am intrigued that the initial figures given by the Minister vary somewhat from the figures given in answer to a similar question a month or two ago. One would think the historical answers would be firm.

The question focused on the impact of changing circumstances on current employment, not on the Minister's efforts to bring in further jobs which we can analyse in a separate question. Is there a separate unit within the Department for companies at risk? Is there a constant analysis of vulnerable companies?

Is the Minister aware that small and medium sized industries across the country are highly marginal and feel isolated and vulnerable? What specific steps has she taken to deal with the changed economic circumstances, where the trends before the advent of war were that redundancies are up by more than 6% in the first two months of this year and where for five consecutive months there has been a decline in industrial output? With that in mind, what support mechanisms has she put in place to protect existing employment and give succour, support and practical help to companies who are marginal?

Ms Harney: Information on Mary Harney  Zoom on Mary Harney  I do not know why the figures would be different. I will check that. Clearly they should be the same. I hope it is not an error but I will clarify that later.

As the Deputy will be aware, Ireland is one of the most globalised economies. According to a recent survey, it is the most globalised economy in the world, with 60% of our jobs dependent on our performance in export markets. We trade about 160% of our GDP. In that context, it is obvious that conditions overseas to a large extent determine the success or failure of Irish companies.

We do not have a specific set of measures to help companies in trouble because the kind of difficulties vary from one company to another, but within Enterprise Ireland there are a range of supports available for companies to up-skill their work forces, to invest in new technology and to [751] engage in market diversification for research and development, all focused on making companies more sustainable and more competitively effective.

There is an early-warning unit in the Department, which seeks to keep an eye on companies that are in difficulties. These tend to be in certain sectors and all of us know the sectors that find themselves in difficulties from time to time. Any company involved in basic manufacturing will clearly have difficulties operating out of an economy such as ours – not in all cases, but generally. That is why a huge focus of our industrial strategy in recent times has been on encouraging companies to introduce new value-added activities, investing in innovation and research and development and raising the skills level of work forces. That strategy is paying dividends. Only last night, I met 72 buyers who had come here from central and eastern European countries as part of Enterprise Ireland's strategy of diversifying our trade into new world markets. That will be an important element in helping small Irish companies to pool with companies overseas and perhaps to out-source some of their activities with a view to keeping the higher-value end of their businesses in Ireland.

Mr. Howlin: Information on Brendan Howlin  Zoom on Brendan Howlin  Would the Minister accept that it is equally important, if not more important, to sustain existing employment as to win new jobs for Ireland? Bearing this in mind, would it not be desirable to create a one-stop shop for vulnerable companies within her Department to co-ordinate support mechanisms, even if it is only to provide information?

Ms Harney: Information on Mary Harney  Zoom on Mary Harney  Yes, it is more important to sustain existing employment. As they say, a bird in the hand is worth two in the bush. It is clearly easier to work with existing investors than to try to find new ones. That is done on the indigenous side by Enterprise Ireland and on the overseas side by the IDA. Within my Department, the industrial policy unit is constantly keeping a brief on upcoming trends with a view to warning Government if any decisions would be likely to affect the competitiveness of any sector.

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