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Job creation in 2015 – EI and IDA end-of-year statements

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Both Enterprise Ireland (the state agency charged with supporting exporting indigenous enterprises) and the IDA (the state agency responsible for supporting Foreign Direct Investment) issued very upbeat end-of-year statements this week. So, how did the region’s fare?

Enterprise Ireland

In 2015 total employment in EI client companies was 192,223, of which 165,630 were full-time jobs. 2015 saw the highest level of new jobs created by EI supported companies in the agency’s history (about 17 years) with 21,118 new jobs created. Taking into account job losses over the year, the net increase was about half this at 10,169 net new jobs.

Of this net increase in EI client jobs, 64% occurred outside of Dublin. It is notable that the regional performance got considerably greater focus in this year’s end-of-year statement Press Release than has been the case for the past number of years. The evident dissatisfaction in many regional locations caused by a two-speed jobs recovery, which led to the preparation of the regional Action Plans for Jobs and several other regional EI initiatives last year, has led to greater emphasis on regional performance in this year’s end-of-year statement. As indeed has the fact that that performance has been quite strong.

While the overall regional picture may be quite strong, the relative performance across the various regions differs (Fig. 1). The increase in jobs in EI client companies in 2015, compared with 2014, varied from +36% in Dublin to just +2% in the North West. Indeed the North West, Mid-West and West – the three EI regions covering the Western Region – had the lowest increases in job numbers across the country at +2%, +3% and +5% respectively. Sticking with the two-speed jobs recovery metaphor, the Western Region appears to be running at the lowest speed of all, at least in the context of indigenous exporting companies.

Infographic from the Enterprise Ireland end-of-year statement 2015

Fig. 1: Infographic from the Enterprise Ireland end-of-year statement 2015 https://enterprise-ireland.com/en/News/PressReleases/2016-Press-Releases/End-of-Year-Statement-2015.PDF

A previous WDC Insights Blog post highlighted the particular issue of the North West’s poor performance in terms of all types of agency assisted employment (EI, IDA and Udarás). Between 2005 and 2014 the North West experienced the largest decline in agency assisted jobs of any region in Ireland. And now in 2015 it’s the region with the lowest increase in EI supported jobs. This points to a very real concern for the North West’s capacity to generate new employment in export focused businesses, even when Ireland is experiencing some of its strongest ever jobs growth in this type of business.

IDA

2015 saw the highest level of employment in IDA client companies in the organisation’s 67 year history reaching 187,056. A total of 18,983 new jobs were created by their clients during 2015, when job losses are taken into account, there was net job creation of 11,833, slightly higher than that recorded by EI clients.

Similar to EI, the IDA’s end-of-year statement gives more focus to regional performance than in some previous years. Overall, 53% of all jobs created by IDA clients in 2015 were based outside of Dublin, which is an improvement over the 49% share in 2014.

While 53% of new jobs were created outside of Dublin in 2015, this area accounts for 59% of total employment in IDA backed companies. The legacy of past investments in more regional locations continues to influence the overall pattern of FDI jobs, even as new investments tend to be attracted to more urban areas.

The IDA end-of-year statement doesn’t provide detail on the differences across the regions, though it does note that every region experienced an increase in employment in IDA backed companies. It will be very interesting to see the detailed regional breakdown of this performance to see if it shows a similar inter-regional pattern to the EI client companies, with the Western Region having the lowest growth. Although the strength of Galway in attracting FDI means the West region may show a stronger performance in foreign owned employment in 2015 than in Irish owned.

While overall, 2015 was very positive in terms of regional job creation by both EI and IDA client companies, the inter-regional differences in the results for EI companies would indicate that more needs to be done to increase the pace of the jobs recovery in the Western Region.

Pauline White

Survey shows 60% of creative entrepreneurs working on their own

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Later today (29 October), the WDC will launch a new transnational project to support the development of the creative industries sector.

The new three-year, €2m transnational creative momentum project aims to support creative entrepreneurs through innovation and skills development, opportunities to network and collaborate across the five partner countries and improved access to international markets. The project will be run by six partner organisations based in Mid-Sweden, North East Iceland, Northern Finland, South East of Northern Ireland and West of Ireland. It is co-funded by the EU Interreg Northern Periphery & Arctic Programme.

In order to inform the development of the project’s activities, the project circulated an online survey to creative entrepreneurs based in the participating regions. The survey ran from 28 September to 18 October and there were a total of 170 responses. The preliminary results of the analysis show some very interesting findings which have implications for policy and supports aimed at developing this sector.

  • 60% of respondents indicated they worked on their own, with a further 31% working in enterprises employing fewer than five people. The survey also showed that just over half (53%) of respondents worked from their own home. The sector seems to be strongly characterised by sole traders and freelancers.
  • 45% reported being members of some form of creative network or collective.
  • 68% reported that they made some sales outside of their own country, which was higher than indicated in previous surveys. Cross-border business between Ireland and Northern Ireland seemed to be a strong element in these export sales. Of those businesses who did not export currently (44), 70% indicated a desire to export.
  • For those who did make export sales, personal sales was the most significant route, reported by 21% of respondents, 14% indicated they used their own online shop, 11% that they exhibited at galleries in other countries and 9% indicated they used retail outlets in their target market.
  • In terms of mentoring, it found that 43% had not received any mentoring, while 43% had received mentoring. A further 10% had been both a mentor and had been mentored at some stage.
  • For training needs, showcasing/presenting your work, marketing, accessing new markets and sales were the top four topics.

Further analysis on these survey results will be published over the coming weeks on www.MyCreativeEdge.eu and will be useful in highlighting the current issues facing entrepreneurs across this sector.

Under a creative momentum project, the Whitaker Institute at NUI Galway will be undertaking a number of studies of the creative industries sector, and its value, to the partner regions.

Pauline White

Unemployment declining in Western Region at a slower pace

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A few interesting trends are emerging from our initial analysis of a special run of data received from the CSO’s Quarterly National Household Survey for Quarter 1 2015. This data covers the seven county Western Region and compares data for the region with the rest of the state (all other counties combined).

Following the general trend, the Western Region’s unemployment rate is declining but this is happening at a slower pace than elsewhere. The region’s unemployment rate is now 10.4%, above the 9.8% rate in the rest of the state (Fig. 1). This compare with 11.4% and 12.1% respectively a year previously (Q1 2014). The unemployment situation seems to be improving more rapidly in the rest of the state.

Fig. 1: Unemployment rate in Western Region and rest of the state, Q1 2006 - Q1 2015. Source: CSO, QNHS Q1 2015. Special run.

Fig. 1: Unemployment rate in Western Region and rest of the state, Q1 2006 – Q1 2015. Source: CSO, QNHS Q1 2015. Special run.

Part of the reason for this is that the numbers in employment in the region have grown by less than elsewhere. Over the past year the numbers at work increased by 1.4% in the Western Region compared with 2.3% growth in the rest of the state.

The slower decline in the region’s unemployment rate also carries through to long-term unemployment which fell from 7.0% to 6.4% in the Western Region compared with a far greater drop (7.3% to 5.8%) in the rest of the state.

But it is among young people that the region’s poorer unemployment record really stands out. The unemployment rate among young people (15-24 years) in the Western Region is 30.8% (Fig. 2). This is a full 10 percentage points higher than in the rest of the state (20%). And unlike the general trend, the youth unemployment rate in the region is continuing to climb, up from 29.2% in the past year. This is in stark contrast to the rest of the country where youth unemployment declined strongly (from 24.6% to 20%) widening the regional gap even more.

Fig. 1: Unemployment rate in Western Region and rest of the state, Q1 2006 - Q1 2015. Source: CSO, QNHS Q1 2015. Special run.

Fig. 1: Unemployment rate in Western Region and rest of the state, Q1 2006 – Q1 2015. Source: CSO, QNHS Q1 2015. Special run.

Earlier this week the Irish National Organisation of the Unemployed (INOU) highlighted the fact that jobseekers in rural areas are finding it harder to get a job and that the recovery is not being felt in all parts of the country.  Our initial analysis of the Q1 2015 data for the Western Region, where two-thirds of the population live in rural areas, supports this assertion and in particular for younger jobseekers.

The need for a more even spatial pattern of job creation has been highlighted in a number of recent strategies such as the IDA’s, and the upcoming Action Plan for Jobs for the West and Border regions will also focus on this, but it remains to be seen how effective these strategies will be.

The WDC will be releasing further analysis of the region’s labour market over the coming months.

Pauline White

Next Generation Broadband Deployment – Lessons from Australia

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As the Department for Communications, Marine and Natural Resources in Ireland prepares the National Broadband Plan Intervention Strategy, it is useful to consider some lessons which can be learned from elsewhere. The experience of Australia is instructive, in part illustrating some of the pitfalls.

  1. Ambitious targets with ambitious deadlines

In 2009 the Australian Government announced an ambitious programme to deliver fibre to the premises (FTTP) to 93% of Australian premises (residential and commercial). This was a very ambitious target given the country’s very low population density (3% compared to Ireland’s 67%). The remaining 7% of the population, in the very remote parts of Australia, were to be served by satellite and wireless technologies.

The original deadline for completion was within six years (2015). By the end of 2013 just 3% of premises were connected.

Following an extensive review in late 2013, a change in direction and new targets were announced[1].

  • Instead of 93% FTTP, it is more likely to be 22% FTTP, the exact technology (and therefore the actual %) will be determined on area basis.
  • Fibre to the node (FTTN) to 71% approximately of premises, with the remaining 4% and 3% fixed wireless and satellite respectively.
  • Lower speeds (50Mbps rather than 100+ Mbps download) resulting from the higher rate of FTTN connection rather than FTTP.
  1. Increasing costs – to the exchequer

The original plan in 2009, was forecast to cost AUD $44 billion (Australian dollars). In 2013, the estimated cost increased to AUD $73 billion – 65% greater than the original forecast.

  1. Higher costs – to the consumer

There is concern that the retail costs will be much higher than the cost of services currently available, estimated at an extra AUD $43 per month[2]. This will influence the take-up of next generation services. Broadband is now accepted as a basic utility and access to it is considered necessary for participation in society and the economy. However as the recent water protests in Ireland demonstrate, basic utilities should not be expensive. The concept of ‘Willingness to Pay’ is a key element of the pricing structure.

From an Irish perspective, it will be interesting to see from the trials of next generation broadband (in Cavan and Mayo for example), to what extent consumers will revert to a basic service at a cheaper price rather than paying extra for a premium product. It is also likely that the consumers in the pilot areas will be more receptive to paying for a premium service which they currently access, compared to those yet to experience the benefits of the premium next generation service.

  1. What are consumers looking for?

There is a declining value to additional broadband speeds. Part of the Australian review included an assessment of the growth in demand for faster broadband speeds. A key finding is that while the Willingness to Pay for speed may grow rapidly at low speeds (less than  40 Mbps download), for most people the Willingness to Pay is not expected to grow at all for high speeds (greater than 50 Mbps)[3].

A related finding is that consumers would prefer an increase to their current speeds quickly, rather than to wait longer to gain a higher level of speed. The Australian Government are now looking at prioritising delivery to those areas which are poorly served and this is consistent with the findings of the Independent Review. http://www.nbnco.com.au/content/dam/nbnco2/documents/soe-shareholder-minister-letter.pdf.

In an Irish context an increase in speed for example from 5Mbps to 10 Mbps is worth more to consumers than an increase from 20Mbps to 25Mbps. The Australian experience also suggests it would be preferable to rollout delivery to those areas with poor and inadequate broadband first.

  1. Don’t play politics with important infrastructure

In Australia, the different ruling parties have taken different policy positions on the rollout of next generation broadband. A change of Government can (and has in Australia) led to a change in policy on delivery and this can create huge uncertainly for investors as well as consumers. Given the scale of investment, the deployment of next generation broadband will generally take many years and beyond the lifetime of one Government. It is therefore important that Government policy is well considered and implemented consistently and not compromised by the electoral cycle.

Deirdre Frost

[1] https://www.communications.gov.au/sites/g/files/net301/f/Cost-Benefit_Analysis_-_FINAL_-_For_Publication.pdf, http://spectrum.ieee.org/telecom/internet/the-rise-and-fall-of-australias-44-billion-broadband-project/

[2] https://www.communications.gov.au/sites/g/files/net301/f/Final_Ministerial_Statement.pdf

[3]  p. 16 https://www.communications.gov.au/sites/g/files/net301/f/Cost-Benefit_Analysis_-_FINAL_-_For_Publication.pdf

Next Generation Rural Broadband – When and How Much?

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On the 11th May, WDC attended the official launch, by An Taoiseach Enda Kenny T.D. and Ministers for Communications and Rural Affairs, of eircom’s Fibre To The Home (FTTH) rural broadband trial in Belcarra, County Mayo. This trial offers broadband speeds of up to 1Gb/s (1,000Mb/s) to rural residents and businesses and demonstrates the value of a fibre to the premises solution.

This is a far cry from the very basic broadband service which was made available under the State supported National Broadband Scheme (NBS) which in theory delivered up to 10Mb/s, but for most users, much less than this.

For most rural residents still trying to survive with basic, intermittent and inadequate broadband speeds, the announcement of a service delivering 1,000Mb/s in a rural area, must seem both frustrating and promising at the same time.

The Government have committed to a basic minimum of 30 Mb/s to all citizens under the National Broadband Plan. However rollout under this state funded scheme has yet to start, with the competition to award the tender to the successful applicant(s) yet to take place. Rollout will not commence until 2016, and all citizens are to be served by 2020.

A few days later, an Taoiseach and Minister for Communications unveiled another fibre to the building project, this time through the joint venture between ESB and Vodafone, called Siro. Siro aims to be Ireland’s first 100% fibre-to-the-building broadband network. This will focus on delivering fibre to the home to fifty regional towns across Ireland.

While both eircom and ESB/Vodafone are making commercial investments in fibre based solutions to urban centres, they are both positioning themselves as the preferred bidder to deliver on the planned Government funded National Broadband Plan to rural areas which will deliver the minimum speed of 30 Mb/s.

These announcements raise interesting questions for the Government funded scheme. While 30 Mb/s is the minimum target for all users, the pilot demonstrates that technically 1,000 MB/s can be delivered to very rural communities. The fibre to the home rural pilot raises the bar as to what speeds might be possible in rural areas. However these will not be commercially funded services and will require state support. The cost of such a fibre based solution and how much will be borne by the state is not clear.

The WDC welcome the developments delivering fibre based solutions to regional and rural locations. However key questions for users have yet to be answered such as when exactly will it be delivered? What speeds are likely to be available in rural areas (it is recognised that 30Mb/s is the minimum) and how much will it cost to fund?

Until the new services are delivered, businesses and citizens will continue to work with inadequate broadband, frustrated in their capacity to communicate with clients and suppliers alike and hampered in their ability to access online services. The priority now is to start rollout under the state funded scheme as soon as possible.

Deirdre Frost

Balanced regional development – What does it mean?

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It is clear that some regions in Ireland are growing much more than others (see Regions and Recovery post), with some even showing ‘growth strains’ (Dublin Economic Monitor, Issue 1, Spring 2015, p.4 ). It is also evident that while national economic growth is the main policy objective, policy on where this growth should occur is less clear. This lack of direction is compounded by the hiatus waiting for the development of a successor to the National Spatial Strategy (NSS) (2002), which is not likely to emerge until late 2016 at the earliest.

In the meantime, work to promote ‘balanced regional development’ continues with policy initiatives and actions being developed to spread growth and development more widely across the country, including the recently announced IDA Strategy 2015-2019  to boost regional FDI employment, along with the formulation of Regional

Action Plans for Jobs, and the implementation of recommendations from the Commission for the Economic Development of Rural Areas (CEDRA).  These initiatives seem to have largely emerged because of growing unease at the uneven spatial pattern of economic recovery.

However the term ‘balanced regional development’ is open to many interpretations and recent commentary provides evidence of that. Though the term is widely used, confusion or obfuscation over what is actually intended has not helped the debate on policy implications and direction, let alone any efforts at implementation. Indeed some might argue that the term is used because it is so vague.

In developing a successor to the NSS, it is important to learn from the experience since 2002 and while poor implementation is often cited as the main reason for the NSS’s limited success, lack of clarity on what ‘balanced regional development’ really meant was also a contributing factor.

A range of meanings

Balanced regional development was expressed as a key Government policy objective in the NSS 2002- 2020 published in 2002 and was a key objective of the National Development Plan 2007-2013 (2006). Though balanced regional development became an important government policy, it was not clearly or consistently defined and a range of interpretations and meanings were evident.

In 2002 the NSS stated that

‘In order to achieve more balanced regional development, a greater share of economic activity must take place outside the GDA’ (p. 3). This suggests increasing the rate of growth and the share of growth in regions other than the GDA and/or curtailing the rate of growth in the GDA, reducing its share of national economic activity.

Elsewhere the NSS argued that all areas should experience growth… ‘by increasing economic activity in all areas’ (p. 4).

The other concept which is very prevalent throughout the NSS is that of realising potential and many would argue that this, rather than reducing disparities, became the main definition. ‘In essence, balanced regional development means [d]eveloping the full potential of each area to contribute to the optimal performance of the State as a whole – economically, socially and environmentally’. (p.11)

The development of the urban structure and a more balanced distribution of population were also considered important. ‘Balanced regional development also depends on building up a strong urban structure to give areas the economic strength to support a more balanced distribution of population growth across the country’. (p.26)

In Chapter two, the lack of clarity on what is meant by balanced regional development was evident in the following

‘The question that arises, however, is whether the objective of balanced regional development would be better served if more growth in population could be encouraged in other regions, while still nurturing and sustaining the successful dynamic achieved in Dublin’. (p.29)

It is evident that within the NSS there was a range of meanings implied in the concept of balanced regional development, which result in different policy objectives for example:

  • Growing regions outside the GDA (p.3) suggested reducing the imbalance between regions, implying slower growth rates in stronger regions and faster growth in weaker regions leading to more regional convergence.
  • Increasing economic activity in all areas (p. 4), could mean equivalent growth rates across all regions or could mean very different growth rates resulting in either convergence or divergence.
  • While the concept of regional potential is used, what exactly was intended and how it could be measured was even less clear.

Balanced regional development, and how it has been expressed and defined, reflects a spectrum of meanings and objectives in government policy.

The Current Context

Population changes (migration in particular), reflect, among other things, economic development, growth rates and potential in terms of economic opportunities. The current pattern of population growth is not dissimilar to that which occurred at the start of the 2000s when the NSS was being formulated. The share of national population in the GDA rose from 37.7% in 1971 to 39.2% in 2002. (p.29)

This continues, with population increasingly concentrated in the GDA and forecast to continue in this way. WDC analysis of the latest CSO Regional Population Projections 2016-2031 shows that the GDA is projected to increase its share of national population to 42.3% in 2031 while all other regions are projected to have a reduced share (though still experiencing population growth).

The population of working age will become more concentrated, with the West and Border being the only regions with a projected decline in their working age population and consequent increases in older and younger age dependency ratios (see previous post).

Growing concentration can also be seen in economic activity. In 2002 the GDA accounted for 46.2% of the State’s total Gross Value Added (GVA), in 2012 its share was 49.6% (CSO, County Incomes and Regional GDP 2012).

Lessons to be learned

In considering the formulation of a new spatial plan or National Planning Framework to frame economic development throughout Ireland, it will be important to draw on valuable lessons learned from the NSS 2002.

Poor implementation is often cited as the main reason for the limited success of the NSS. While this is no doubt a factor, a key aspect of policy formulation must also be clearly defined policy objectives.

How we define balanced regional development (or any similar concept) is important.  Clear definition of regional balance, the need for regional equity or the development of regional potential will ultimately influence the policies used to achieve them.  Though such definitions are politically and practically difficult, failure to make clear what is meant by regional balance, with clear goals and targets will, as we have seen with the NSS, lead to policy failure and to further regional imbalance.

When considering a new national planning framework which aims to deliver balanced regional development, deciding and agreeing what we actually mean by balanced regional development and how we measure it would be a useful starting point which might ultimately ensure a greater chance of success.

Deirdre Frost

 

The Western Region’s Sectoral Profile

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We’ve just published WDC Insights-The Western Region’s Sectoral Profile-April 2015 (PDF 0.2MB) which presents the key findings from The Western Region’s Labour Market 2004-2014-WDC Report March 2015 (PDF 2.5MB) on the region’s sectoral pattern of employment.

Understanding the sectoral pattern of jobs in the region, and recent patterns of sectoral growth and decline, is particularly important to the development of job creation, skills and enterprise policy for the region.

Sector of employment

The two largest employment sectors in the Western Region are Wholesale and Retail, and Industry with around 30% of jobs (Fig. 1).  Of the region’s top seven sectors, all (except Health) account for a greater share of jobs in the region than the rest of the state.  Agriculture and Industry (manufacturing) are considerably more important in the region.  Among the region’s smaller sectors the share working in them in the region is considerably below that in the rest of the state.

In general the Western Region’s jobs profile relies more heavily than the rest of the state on the traditional sectors (Industry, Agriculture and Construction) and local services (Wholesale and Retail, and Accommodation and Food Service) which depend on domestic spending and tourism.  The region’s sectoral jobs pattern is influenced by its largely rural nature.

Fig. 1: Percentage of employment by sector in the Western Region and rest of the state, Q1 2014 (Source: CSO, Quarterly National Household Survey, Q1 2014, Table 2. Special run)

Fig. 1: Percentage of employment by sector in the Western Region and rest of the state, Q1 2014 (Source: CSO, Quarterly National Household Survey, Q1 2014, Table 2. Special run)

Western Region’s share of jobs by sector

This jobs pattern can also be seen in the region’s share of national total jobs in each sector.  In total 16.5% of all jobs in the state are located in the Western Region (Fig. 2).  Agriculture, Industry and Construction are the sectors where the region makes its largest contribution to national jobs.

The region’s share of all Industry jobs nationally has increased very strongly in recent years from 16% in 2007 to its current 19.5%, due to its relatively more stable jobs performance in the region.  The region’s manufacturing strength is a key national asset and a previous blog post on ‘Trends in Agency Assisted Employment in the Western Region’ highlighted the industrial sub-sectors which have driven the region’s manufacturing strength.

The three knowledge intensive services sectors are where the region accounts for its lowest shares of national jobs.  Less than 10% of all Information and Communication, and Financial, Insurance and Real Estate jobs are based in the region and its share of both has declined since 2012.  Not only does the region have low shares in these sectors but it is losing ground.

Fig. 2: Percentage of total employment in the state based in the Western Region by sector, Q1 2014 (Source: CSO, Quarterly National Household Survey, Q1 2014, Table 2. Special run)

Fig. 2: Percentage of total employment in the state based in the Western Region by sector, Q1 2014 (Source: CSO, Quarterly National Household Survey, Q1 2014, Table 2. Special run)

Recent changes in employment by sector

Between 2012 and 2014 half of sectors (7 of 14) experienced jobs growth in the Western Region (Fig. 3).  Agriculture grew most strongly followed by Professional, Scientific and Technical activities next.  Growth in these sectors contributed to the region’s increasing share of self-employment.  Wholesale and Retail and Accommodation and Food Service also grew as this period coincided with an increase in overseas visitor numbers as well as consumer spending.

The Western Region experienced a far greater jobs decline than the rest of the state across many sectors, including knowledge intensive services and public services.  In the case of Information and Communication, employment fell by nearly 16% in the region but it had the fourth largest growth in the rest of the country (5.2%).  The reasons for the Western’s Region poor, and weakening, jobs performance in this high growth potential sector need to be investigated.

Fig. 3: Percentage change in employment by sector in the Western Region and rest of the state, Q1 2012 to Q1 2014 (Source: CSO, Quarterly National Household Survey, Q1 2014, Table 2. Special run)

Fig. 3: Percentage change in employment by sector in the Western Region and rest of the state, Q1 2012 to Q1 2014 (Source: CSO, Quarterly National Household Survey, Q1 2014, Table 2. Special run)

These key aspects of the Western Region’s labour market should inform the development of the upcoming Action Plan for Jobs for the West, Border and Mid-West regions.  The region’s labour market characteristics should influence which policies are prioritised for the region and the sectors of focus for job creation strategies.

Download WDC Insights The Western Region’s Sectoral Profile and full report ‘The Western Region’s Labour Market 2004-2014’ here

Pauline White

 

Note: The CSO has noted concerns over the impact of the new sampling structure on the employment figures for Agriculture. 

Source: CSO, Quarterly National Household Survey, Quarter 1 2004-2014, special run

 

The Western Region’s Labour Market

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The WDC has just published a new analysis of the Western Region’s Labour Market. This is based on a special run of data from the CSO’s QNHS for the period 2004-2014 for the seven-county Western Region. Understanding the region’s labour market is important for effective job creation, enterprise and skills policy.

In 2014 the Western Region’s adult population was just over 600,000 with 350,000 active in the labour force. Its labour force has contracted since 2012, largely because of outward migration, and is characterised by higher part-time, under- and self-employment, for both men and women. These are distinct differences in the nature of the region’s labour market that may point to certain weaknesses which need to be addressed by tailored job creation actions for the region.

Western Regions adult populatin diagram

 

Some of the key findings of the analysis are:

  1. Lower labour force participation in the Western Region: A smaller share of the Western Region’s adult population is engaged in the labour market and therefore economically active. The region’s participation rate in 2014 is 57.7% compared with 60.1% in the rest of the state. As human capital is among the most critical factors for regional economic development, this has negative implications for the region’s economic growth and viability. The higher level of economic dependency, resulting from the larger proportion of the population outside of the labour force, also has important social impacts and increases the need for state transfers.
  2. Higher share of self-employment: The region has a higher share of self-employment (without employees) than the rest of the state – 16.3% of all employment in the region compared with 11.4% in the rest of the state. This increases the importance of policy and supports to facilitate the self-employed to establish and sustain their businesses, such as soft business supports, quality broadband, networking, etc. Many may work from home or are mobile and are engaged in local services and therefore outside the remit of the enterprise agencies. They play a particularly significant role in sustaining rural communities and economies. This role, and their needs, requires further investigation and policy focus.
  3. Higher share of part-time working and recent jobs growth more likely to be part-time: There is a higher degree of part-time working in the region with 25.7% of all jobs in the region in 2014 part-time, compared with 23.5% in the rest of the state. Recent jobs growth has also been more likely to be part-time in the region than elsewhere. While part-time working can play an important role for those with caring and other commitments, the greater share of recent jobs growth in the region that is part-time raises some concerns over the nature of employment and the quality of recent jobs growth. A focus on stimulating more full-time jobs should be built into job creation policy for the region.
  4. Lower employment growth: Employment in the region grew over 2012-2014 by 1.4% but this was less than in the rest of the state (3.9%). The jobs recovery in the region is lagging that elsewhere. Initiatives to stimulate and facilitate job creation in regional locations are required to address the region’s weaker jobs performance.
  5. Declining unemployment influenced by out-migration: Unemployment has declined by 28.4% since 2012 but this has only partially been caused by jobs growth. The greater part is due to the loss of unemployed people from the region, either overseas or to other parts of Ireland. The decline in unemployment in the region has been stronger than elsewhere, leading to its unemployment rate dropping below that in the rest of the state (11.5% compared with 12.1% in 2014), reflecting the significant impact of out-migration on the region’s labour market.
  6. Higher youth unemployment rate: The Western Region has a higher youth (15-24 yrs) unemployment rate, 29.2% compared with 24.6% in the rest of the state. As the region has a lower total unemployment rate, this indicates that youth unemployment is a more serious challenge for the region. High youth unemployment can have very significant long-term impacts, as a period of unemployment at a young age can hinder the person’s career prospects and earnings potential. The needs of young jobseekers in the Western Region should be a key policy priority, nationally and for the region, both to prevent them from falling into long-term unemployment and also to reduce out-migration.

These aspects of the Western Region’s labour market should inform the development of the upcoming Action Plan for Jobs for the West, Border and Mid-West regions. The distinctive characteristics of the region’s labour market profile should influence which policies are prioritised for the region and the sectors of focus for job creation strategies. A new WDC Insights on the Western Region’s sectoral profile will be published in coming weeks.

Download two-page WDC Insights WDC Insights-The Western Region’s Labour Market-April 2015 (PDF 0.2MB)

Download full WDC report The Western Region’s Labour Market 2004-2014-WDC Report March 2015 (PDF 2.5MB)

Pauline White

The Battle for Rural Ireland – RTE 1

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RTE screened a documentary, The Battle for Rural Ireland, on 9th March 2015, to which Deirdre Frost contributed. Presented by Richard Curran, the programme highlights the challenges faced by rural communities and towns, both in the context of the recent recession and the outlook for further rural depopulation. Much of the projected population growth is to occur on the East coast.

You can watch the programme here (available until 30 March).

While urbanisation is not unique to Ireland, the programme shows the effects of population loss on rural areas, in terms of service provision and employment opportunities.

The Battle for Rural Ireland highlights some examples of innovative enterprise development and employment creation in rural areas but ultimately the need for stronger regional and rural policy is clear.

Deirdre Frost

Trends in Agency Assisted Employment in the Western Region

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The WDC has today published a new WDC Insights Trends in Agency Assisted Employment in the Western Region as well as a county profile for each of the seven western counties.

Employment in businesses which have received support from one of the main enterprise agencies, which are usually export oriented, is termed agency assisted employment. The WDC has published its analysis of data on these businesses for the Western Region for 2004 to 2013.

Our analysis has found that:

  • Lower recent growth: There was less volatility in assisted job numbers in the Western Region over the period. Assisted jobs in the region have not grown as strongly as in the rest of the country since growth resumed in 2010.
  • More permanent full-time employment: Recent assisted jobs growth in the Western Region is more likely to be permanent full-time with the share of temporary/part-time jobs lower now than at the start of the period.
  • Concentrated by sector: Assisted jobs in the Western Region are more concentrated by economic sector than in the rest of the state and manufacturing activities continue to dominate.
  • Foreign owned sector driving growth: The strongest recent assisted jobs growth has been in the modern manufacturing and information and communication sectors which are the sectors with the highest shares of foreign ownership. The foreign owned sector has driven recent growth in the Western Region to a greater extent than in the rest of the state.
  • Irish owned sector performing less well: There has been much greater volatility in the Irish owned sector over the ten year period and the region’s Irish owned sector is not showing as strong a recovery as in the rest of the country.
  • Urban concentration: Urban concentration, especially in the cities, is a feature of assisted jobs. The resumption of growth does appear to be spreading across the Western Region to some degree, although Clare and Leitrim have seen no increase in assisted employment.

Agency assisted employment is a key policy tool for job creation and unemployment reduction.  Recent growth in assisted jobs in the Western Region has not been as strong as elsewhere, particularly among Irish owned businesses.  Agency assisted job creation in the Western Region needs to focus on increasing sectoral diversity and strengthening the Irish owned sector.  Addressing the lower levels of assisted employment in the counties of the North West should also be a policy priority.

Download the two page WDC Insights, full WDC Report and/or 7 county profiles here