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Key Issues for the National Planning Framework – Submission from the WDC

The WDC  made its submission on Ireland 2040 – Our Plan: National Planning Framework   yesterday.  The Issues and Choices paper covered a wide range of topics from national planning challenges to sustainability, health, infrastructure and the role of cities and towns.  A key element of the paper considered the future in a “business as usual” scenario in which even greater growth takes place in the Dublin and Mid East region with consequent increased congestion and increasing costs for businesses and society, while other parts of the country continue to have under-utilised potential which is lost to Ireland.  The consultation paper therefore sought to explore the broad questions of alternative opportunities and ways to move away from the “business as usual” scenario.

The WDC submission considers these issues from the perspective of the Western Region, the needs of the Region, the opportunities its development presents for Ireland’s economy and society as a whole and the choices, investments and policy required to achieve regional growth and resilience.

This post highlights the key points made in the submission.  The complete, comprehensive submission on the National Planning Framework by the WDC can be read here (4.5MB PDF).  A shorter summary is available here (0.7MB PDF).

 

What should the NPF achieve?

  • The National Planning Framework (NPF) provides Ireland with an opportunity to more fully realise the potential of all of its regions to contribute to national growth and productivity. All areas of Ireland, the Capital and second tier cities, large, medium and small-sized towns, villages and open countryside, have roles to play both in the national economy and, most importantly, as locations for people to live.
  • While spatial planning strives for ideal settlement or employment patterns and transport infrastructure, in many aspects of life change is relatively slow; demographics may alter gradually over decades and generations and, given the housing boom in the early part of this century, many of our existing housing units will be in use in the very long term. If the NPF is to be effective it must focus on what is needed, given current and historical patterns and the necessity for a more balanced pattern of development.
  • To effectively support national growth it is important that there is not excessive urban concentration “Either over or under [urban] concentration … is very costly in terms of economic efficiency and national growth rates” (Vernon Henderson, 2000[1]). Thus it is essential that, through the NPF, other cities and other regions become the focus of investment and development.

Developing Cities

  • As the NPF is to be a high level Framework, in this submission the WDC does not go into detail by naming places or commenting on specific development projects, as these will be covered by the forthcoming Regional Spatial and Economic Strategies (RSES). The exception to this, however, is in relation to the need for cities to counterbalance Dublin.  In this case we emphasise the role of Galway and the potential for Sligo to be developed as the key growth centre for the North West.
  • The North West is a large rural region and Sligo is the best located large urban centre to support development throughout much of the North West region. With effective linkages to other urban centres throughout the region and improved connectivity, along with support from regional and national stakeholders, Sligo can become a more effective regional driver, supporting a greater share of population, economic and employment growth in Sligo itself and the wider North West region.

Developing Towns

  • While the NPF is to be a high level document and the focus is largely on cities it is important not to assume that development of key cities will constitute regional development. All areas need to be the focus of definite policy, and the NPF should make this clear.
  • While cities may drive regional development, other towns, at a smaller scale, can be equally important to their region. Recognising this is not the same as accepting that all towns need the same level of connection and services.  It is more important to understand that the context of each town differs, in terms of distance and connectivity to other towns and to the cities, the size of the hinterland it serves and its physical area as well as population.  Therefore their infrastructure and service needs differ.
  • Towns play a central role in Ireland’s settlement hierarchy. While much of the emphasis in the NPF Issues and Choices paper is on cities and their role, for a large proportion of Ireland’s population small and medium-sized towns act as their key service centre for education, retail, recreation, primary health and social activities.  Even within the hinterlands of the large cities, people access many of their daily services in smaller centres.  The NPF needs to be clear on the role it sees for towns in effective regional development.

Rural Areas

  • Rural areas provide key resources essential to our economy and society. They are the location of our natural resources and also most of our environmental, biodiversity and landscape assets.  They are places of residence and employment, as well as places of amenity, recreation and refuge.
  • They are already supporting national economic growth, climate action objectives and local communities, albeit at a smaller scale than towns and cities. But a greater focus on developing rural regions would increase the contribution to our economy and society made by rural areas.
  • The key solution to maintaining rural populations is the availability of employment. It is important that the NPF is truly focused on creating opportunities for the people who live in the regions, whether in cities, towns or rural areas.

Employment and Enterprise

  • In the Issues and Choices paper a narrow definition of ‘job’, ‘work’ and ‘employer’ as a full-time permanent employee travelling every day to a specific work location seems to be assumed. This does not recognise either the current reality of ‘work’ or the likely changes to 2040. Self-employment, the ‘gig’ or ‘sharing’ economy, contract work, freelancing, e-Working, multiple income streams, online business are all trends that are redefining the conceptions of work, enterprise and their physical location.
  • If the NPF mainly equates ‘employer’ with a large IT services or high-tech manufacturing company, many of which (though by no means all) are attracted to larger cities, then it will only address the needs of a small proportion of the State’s population and labour force.
  • Similarly the NPF must recognise the need to enable and support the diversification of the Irish economy and enterprise base. It must provide a support framework for indigenous business growth across all regions and particularly in sectors where regions have comparative advantage.

Location Decisions

  • While job opportunities are a critical factor in people’s decision of where to live, they are by no means the only factor. Many other personal and social factors influence this decision such as closeness to family (including for childcare and elder care reasons), affordability, social and lifestyle preferences, connection to place and community.
  • Many people have selected to live in one location but commute to work elsewhere or, in some cases, e-Work for a number of days a week. The NPF needs to recognise the complexity of reasons for people’s location decisions in planning for the development of settlements.

Infrastructure

  • New infrastructure can be transformative (the increase in motorway infrastructure in recent decades shows how some change happens relatively quickly). Therefore it is essential that we carefully consider where we place new investments.  To do so, capital appraisal and evaluation methods determining the costs and benefits of different investment projects need to be re-examined if we are to move from a ‘business as usual’ approach.
  • Investment in infrastructure can strongly influence the location of other infrastructure with a detrimental impact on unserved locations. The North West of the country is at a disadvantage compared to other regions with regard to motorway access. This situation will be compounded if investment in rail is focused on those routes with better road access (motorways) in order for rail to stay competitive, or if communications or electricity networks are developed along existing motorway or rail corridors.
  • The WDC believes that the regional cities can be developed more and have untapped potential, however better intra-regional linkages are needed. The weaker links between the regional centres – notably Cork to Limerick and north of Galway through to Sligo and on to Letterkenny, are likely to be a factor in the relatively slower growth of regional centres in contrast to the motorway network, most of which serves Dublin from the regions.

Climate Change

For the future, the need to move to a low carbon, fossil fuel free economy is essential and needs to be an integral and much more explicit part of the NPF.  The National Mitigation Plan for Climate Change is currently being developed, and it is essential that actions under the NPF will be in line with, and support, the actions in the Mitigation Plan.

How should the NPF be implemented?

  • While much of the role of the NPF is strategic vision and coordination of decision-making, in order for the Framework to be effective it is essential that the achievement of the vision and the actions essential to it are appropriately resourced. The Issues and Choices paper does not give a detailed outline of how the NPF implementation will be resourced, except through the anticipated alignment with the Capital Investment Programme.
  • It should be remembered that policy on services and regional development is not just implemented through capital spending but also though current spending and through policy decisions with spatial implications (such as those relating to the location of services). Therefore it is essential that other spending, investment and policy decisions are in line with the NPF rather than operating counter to it.
  • While the NPF is to provide a high level Framework for development in Ireland to 2040, it seems this Framework is to be implemented at a regional level through the RSES. The Framework and the Strategies are therefore interlinked yet the respective roles of the NPF and the RSES are not explicit and so it is not evident which areas of development will be influenced by the NPF and which by the RSES.
  • In order to ensure that the NPF is implemented effectively it is important that there is a single body with responsibility for its delivery and that there is a designated budget to help achieve its implementation.

 

It is expected that a draft National Planning Framework document will be published for consultation in May.  Following that a final version of the Framework will be prepared for discussion and consideration by Dáil Éireann.

 

As mentioned above the full WDC submission on the Issues and Choices paper Ireland 2040 Our Plan- A National Planning Framework is available here (PDF 4.5MB) and a summary of key point and responses to consultation questions is available here (PDF 0.7MB).

 

 

Helen McHenry

[1] http://www.nber.org/papers/w7503

How is the Western Region doing?

On 31 January, the WDC was invited to give a presentation to officials of the Department of Social Protection working across the Western Region. The objective was to give an overview of the WDC’s analysis of data across a range of socio-economic issues.

Analysing regional data provides information on the areas for which we are responsible and highlights the multi-dimensional nature of the concept of regional development.  A regional perspective is necessary since changes and inequalities not only occur among individuals but also the places where they live

This (very) comprehensive presentation analyses the following indicators:

  1. Population: Preliminary Census 2016 Results
  2. Labour Market: QNHS Q1 2016, special run
  3. Income: County Incomes & Regional GDP, 2013-2014
  4. Enterprise: Business Demography, 2014

These are some of the key points emerging from the analysis.

Population

  • Population of Western Region grew +0.9% 2011-2016 compared with +3.7% growth nationally.
  • Three counties in the Western Region showed population decline 2011-2016 –(Donegal -1.5%, Mayo -0.2% and Sligo -0.1%) – only counties in Ireland to do so. In addition Leitrim and Roscommon had the lowest growth.  Galway city had 5th highest population growth in Ireland.
  • Every county in Ireland had a positive natural increase (more births than deaths) during 2011-2016. Donegal, Sligo and Mayo however had enough negative net migration to lead to population decline.
  • All western counties, and all but six areas nationally, had negative net migration between 2011 and 2016. Donegal and Sligo had the two highest rates of negative net migration.
  • Male out-migration considerably higher than female leading to a +1.5% increase in the female population of the Western Region and only +2% growth in the male population.
Figure 1: Percentage change in population by administrative area, 2011-2016. CSO (2016), Preliminary Results Census 2016

Figure 1: Percentage change in population by administrative area, 2011-2016. CSO (2016), Preliminary Results Census 2016

Labour Market

  • The Western Region’s labour force declined marginally (-1.2%) between 2007 and 2016. Within this the male labour force fell by -6.1% while the female rose by +5.7%.
  • The Western Region has a lower share of its labour force aged under 35 years and a higher share aged over 44 Its labour force participation rate is lower for both men and women, and across all age groups (except 65+).
  • Total employment in the region fell by -5.8% 2007-2016 compared with a -6.5% decline in the rest of the state (all counties outside Western Region)
  • There has been exceptionally strong growth in self-employment in the Western Region since 2012, increasing by +31.1% in the region compared with +7.2% in the rest of the state.
  • Growth of self-employment tied to sectoral pattern of growth with strongest jobs growth since 2012 in Agriculture, Construction, Accommodation & Food Service and Wholesale & Retail, all with high self-emp
  • Since 2012 the Western Region has had jobs decline in 7 out of 14 sectors, in the rest of the state there was only decline in 1 out of 14. Jobs recovery in the Western Region is not as diversified across the economy as elsewhere and more concentrated in domestic sectors
  • Unemployment numbers declining steadily in region, but share of long-term unemployment growing. Western Region has higher unemployment rate in all age groups (except 65+ & 25-34) and particularly among youth.
Figure 2: % change in employment by sector in Western Region and Rest of State, 2012-2016. CSO, Quarterly National Household Survey, Q1 2012-2016, special run

Figure 2: % change in employment by sector in Western Region and Rest of State, 2012-2016. CSO, Quarterly National Household Survey, Q1 2012-2016, special run

Income

  • Disposable income per person in the Western Region was €17,260 in 2013 (92.3% of State). Provisional 2014 figures show some growth (€17,768) but still well below the 2008 peak (€21,167).
  • Longer term, the gap is narrowing, the Western Region had disposable income of 84.3% of State in 1995, 92.3% of State in 2013.
  • Within the Western Region, Roscommon had a significantly lower income relative to the State in 2014 (87.2%) compared with 2005 (95.8%). Clare has also fallen relative to the State starting at 95.5% in 2005 and dropping to 93.3% in 2014. Sligo, Galway, Mayo and Donegal have all improved their position relative to the State since 2005, albeit with some variation. Galway and Sligo had greatest improvements.
Figure 3: Index of disposable income per person in western counties, 2005-2014 (Index State=100). CSO, County Incomes and Regional GDP 2013, provisional 2014

Figure 3: Index of disposable income per person in western counties, 2005-2014 (Index State=100). CSO, County Incomes and Regional GDP 2013, provisional 2014

Gross Value Added

  • Dublin region is the only region where the preliminary 2014 GVA per person figure is higher than the peak GVA per person in 2007. None of the other regions have recovered to the 2007 level, though the difference in the West region is slight.
  • Dublin and Mid-East and South West, only regions with a greater share of national GVA than share of persons at work.
  • In 2005 there were 60.6 index points between the lowest GVA per person in a region (Midland, 65.4) and the highest (Dublin and the Mid-East, 126.0).  In 2014 the difference between Midland (59.2) and Dublin and the Mid-East, (130.6) was 71.4 index points (71.3 in 2013).
Figure 4: Index of GVA per person by region, 2005-2014 (Index State=100). CSO, County Incomes and Regional GDP 2013, provisional 2014

Figure 4: Index of GVA per person by region, 2005-2014 (Index State=100). CSO, County Incomes and Regional GDP 2013, provisional 2014

Enterprise

  • The share of enterprises nationally that are based in the Western Region is declining and was 17.1% of the total in 2014.
  • Construction, Wholesale & Retail, Professional activities and Accommodation & Food Service are the largest enterprise sectors in the region. Less than 5% of the region’s enterprises are in Financial & Insurance and Information & Communications combined.
  • There has been a far greater decline in enterprise numbers in the Western Region than the rest of the state since 2008 and the region had a weaker performance – greater decline or lower growth – in every sector (ex. real estate).
  • The enterprise base differs across more urban and rural counties. Highly rural counties of Roscommon, Mayo and Donegal have 34-36% of enterprises in Industry and Construction but in more urban counties of Clare and Sligo it is around 30%.  A higher share of enterprises in Galway and Sligo are active in knowledge services sectors, though even Galway is below national average. Local services play a larger role in more rural counties.
  • Western counties had among the greatest losses of enterprises since 2008. Donegal lost more than 1 in 3 of its Construction firms; Wholesale & Retail declined most strongly in Donegal and Clare; Accommodation & Food Service declined across most counties.
  • Knowledge services performed best, though from a low base.
Figure 5: % change in number of active enterprises by sector in Western Region & Rest of State, 2008-2014. CSO, Business Demography, 2014

Figure 5: % change in number of active enterprises by sector in Western Region & Rest of State, 2008-2014. CSO, Business Demography, 2014

The full presentation can be downloaded here  (PDF, 2MB)

 

Pauline White & Helen McHenry

Enterprise in Western Counties

Last week the WDC published two new WDC Insights publications.  They were both based on our analysis of the CSO’s Business Demography 2014 data which measures active enterprises in the business economy.[1]  The publications were:

In a previous blog, I outlined our analysis of the data for the Western Region.  In this blog the focus will be on the analysis at county level. It should be noted that in this CSO dataset, enterprises are assigned to the county where they are registered with the Revenue Commissioners. A business with multiple locations (e.g. chain stores, multinationals) is counted once.  Although this limits the data somewhat, and tends to increase the numbers for Dublin, it is a good reflection of local business activity.

Change in enterprise numbers in western counties since 2008

There were a total of 40,797 active enterprises in the Western Region in 2014.  Galway had the highest number at just over 13,000, while there were 1,750 registered in Leitrim (Table 1).  All western counties experienced a decline in enterprise numbers between 2008 and 2014 that was greater than the national average (-2.4%).  At -13.4% Donegal had the second highest decline in Ireland (after Monaghan).

table-1-percentage-change-in-enterpises-in-western-counties-2008-2014

Not surprisingly, the sector which declined most in all counties was Construction.  Wholesale & Retail also declined across all counties and most strongly in Donegal and Clare – possibly influenced by their proximity to other large retail centres.  Accommodation & Food Service declined across most counties, especially Clare.  Combined with a large decline in Transportation & Storage, this may be due to reduced flights into Shannon airport.

In general the knowledge services sectors performed best.  ICT, professional and financial services grew strongly in all counties (with only Clare having a decline in ICT services).  Despite this growth however, these sectors continue to play a relatively small role in the enterprise base of most western counties.

Enterprise base of western counties

Construction and Wholesale & Retail are the largest enterprise sectors in every county (Fig. 1).  In the highly rural counties of Roscommon, Mayo and Donegal 34-36% of enterprises are in the traditional sectors of Industry and Construction, while in the more urban counties of Clare and Sligo it is around 30%.  In Donegal and Leitrim over 40% of enterprises are in the local services of retail, accommodation and transport which rely on domestic spending and tourism.  These activities play a key role in the enterprise base of all counties, though Galway’s more diverse enterprise mix means it is least reliant on them.

fig-1-percentage-of-enterprises-in-western-counties-2014

Galway city and Sligo town are strong regional centres for knowledge service firms and this is clear from the quite high shares of their enterprises in professional, financial and ICT services.  In contrast, these sectors account for only 17% of registered enterprises in Roscommon.

A few examples of particular sectoral enterprise strengths stand out, such as Administration & Support Services in Clare which includes aircraft leasing activities around Shannon and Information & Communications and Financial & Insurance in Galway.  Construction remains hugely important to the enterprise profile of the largely rural counties of Roscommon and Mayo.

Conclusion

There is considerable variation across the seven western counties in terms of their enterprise base.  In general, counties with a higher share of their population living in urban centres (Galway, Clare and Sligo) tend to have a greater share of knowledge services firms and lower reliance on traditional sectors.  The general pattern since 2008 has been one of growth in knowledge services but decline in Construction and local services, a similar pattern to employment trends.  This pattern has a spatial impact as the former tend to concentrate in urban areas while the latter are more important to rural economies.

Pauline White

[1] It excludes Agriculture, Health, Public Administration and Other Services, as well as activities of holding companies.  It includes data on Education but this is not counted in ‘total business economy’ as many of the enterprises are publicly owned and is not analysed here.

Three West of Ireland Craft Businesses Participate in Swedish Festival

‘People buy from people’.  That’s according to Kevin Lynch (Airmid Natural Irish Skincare), who, along with Sallyann Marron (Sallyann’s Handmade Bags) and Urs Harttung (Bearfoot Enterprises) has just returned from the Urkult folk festival in Näsåker in mid-Sweden.  The three West of Ireland craftspeople showcased and sold their work, all handmade in counties Clare and Galway, directly to festival-goers at Urkult’s craft market. They were supported by the Western Development Commission through a creative momentum project.

‘Participating in the Urkult folk festival gave me the freedom to be proud of my craft and to present it to a whole new audience,’ says Urs, originally from Switzerland but now based in Headford.  Urs upcycles wood and other materials to produce a range of original products.  For his unique Coo-Jo, he uses biscuit tins to create a banjo-like musical instrument.  An idea that proved a big hit with festival-goers.  ‘I’ve received invitations to come back and give two workshops and there was a lot of interest in my products that I’m very hopeful will lead to future orders’, he said.

According to West Clare’s Sallyann Marron, ‘I’ve found out that Swedish people like my bags as well, and that’s really encouraging’.  Sallyann uses recycled jeans in the linings of her bags, making each a unique creation.  During a Pecha Kucha event at Urkult, she explained exactly how she creates one of her highly individual bags.

Kevin Lynch found that people at Urkult, which has a very eco-friendly ethos, were genuinely interested in his range of organic and natural skincare products. ‘Our organic production of flowers and botanicals in the Burren was a story that really caught the Swedes’ imagination.  I expect we’ll get a big increase in online sales to Sweden,’ he added.

In total, eight craftspeople from the West of Ireland, Northern Ireland and Finland were funded to participate in Urkult through a creative momentum project, an EU co-funded project supporting the development of the creative industries sector across Europe’s Northern Edge.  The project operates the www.MyCreativeEdge.eu website and in the West of Ireland is implemented by the Western Development Commission and NUI Galway.

No. of Enterprises in Western Region declines 8.6% since 2008

The CSO recently released their Business Demography data for 2014 which, combined with the Preliminary Results of Census 2016, shows the continuation of clear economic as well as demographic spatial patterns.

The Business Demography data measures active enterprises in the business economy[1] and provides data at county level.  An enterprise is assigned to the county where it is registered with the Revenue, so for a business that has multiple locations (e.g. chain stores, banks, multinationals) the business is only counted in the county where it is registered (often Dublin).  This makes the data somewhat limited, however it does give a true reflection of enterprises that are registered and operating in a county.

Greater decline in enterprise numbers in Western Region since 2008

In 2014 there were 40,797 active enterprises registered in the seven county Western Region.  This was 8.6% below the 44,621 in 2008.  In contrast, in the rest of the state (all counties other than the seven counties of the Western Region) the number in 2014 was just 1% below the 2008 figure.  And there were even greater differences when we consider sectors.  Fig. 1 shows that with the sole exception of Real Estate, the Western Region had a weaker performance – greater decline or lower growth – than the rest of the state in every sector between 2008 and 2014.

Fig. 1: Percentage change in active enterprises, Western Region and Rest of State, 2008-2014. Source: CSO, Business Demography 2014 http://bit.ly/2ac2fw7

Fig. 1: Percentage change in active enterprises, Western Region and Rest of State, 2008-2014. Source: CSO, Business Demography 2014 http://bit.ly/2ac2fw7

Weaker performance for Western Region across almost all sectors

Unsurprisingly Construction experienced the greatest decline in the number of enterprises, while the locally traded services sectors of Transportation & Storage, Wholesale & Retail also declined in both the region and rest of the state.  For three sectors (Financial & Insurance, Accommodation & Food Service, and Industry) there was a fall in the region, but growth elsewhere.  The Financial & Insurance sector shows a very stark difference, while there was also a substantial difference for Industry.

In the sectors where the Western Region experienced growth, we can see there was a considerable gap with the rest of the state the knowledge services sectors of Information & Communications and Professional services.

Higher share of enterprises in traditional sectors and local services

The difference in the experience over the period contributed to the current enterprise profile of the the Western Region and rest of the state. Fig. 2 shows that, similar to employment patterns, the traditional sectors (Construction and Industry) and local services (Wholesale & Retail and Accommodation & Food Service) account for larger shares of all enterprises in the region, with a lower share of enterprises in knowledge services sectors.

Fig. 2: Percentage of active enterprises by sector, Western Region and rest of state, 2014. Source: CSO, Business Demography 2014 http://bit.ly/2ac2fw7

Fig. 2: Percentage of active enterprises by sector, Western Region and rest of state, 2014. Source: CSO, Business Demography 2014 http://bit.ly/2ac2fw7

Varying performance for western counties

From Fig. 3 it is clear that there were massive differences in the experience of counties over the period, ranging from a 14.2% decline in the number of enterprises in Monaghan to a 7.1% increase in Dublin, the only county with more registered enterprises in 2014 than in 2008.  This is of course influenced by the practice of registering business headquarters in Dublin even if they have locations in other counties.  Evan allowing for this, there is a clear spatial pattern with Border and Midland counties experiencing particularly large declines.

Among the western counties, two of the large rural counties (Donegal and Mayo) experienced the greatest declines in enterprise numbers.  Roscommon, Clare, Galway and Leitrim meanwhile had quite similar experiences, declining by around 7%.  Sligo performed best with a fall of just over 4% in its number of enterprises.  The enterprise profile of each county and the performance of enterprises in different sectors is a key explanation for these county differences and we’ll examine county patterns in more detail in a future post.

Fig. 3: Percentage change in active enterprises by county, 2008-2014. Source: CSO, Business Demography 2014 http://bit.ly/2ac2fw7

Fig. 3: Percentage change in active enterprises by county, 2008-2014. Western counties in green. Source: CSO, Business Demography 2014 http://bit.ly/2ac2fw7

In addition to the data on enterprise numbers, the Business Demography data also provides information on employment in these enterprises, which we’ll also examine in more detail in future. But this initial overview of the data clearly shows a significant decline in the number of enterprises based in the Western Region which is reflected in a weaker performance across all sectors of the business economy.

Pauline White

 

[1] It does not include Agriculture, Health, Public Administration or Other Services. While it does include data on Education, that sector is not counted in the total figures as many of the enterprises in the sector are publicly owned.

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

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

WDC Insights- Christmas Quiz!

We hope you have been following and reading the WDC Insights blog in the last year. Take our Christmas Quiz (9 questions) and see how well you score on regional development and Western Region issues. The answers are below with links to more information and the relevant posts.

Good Luck!

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1      The WDC published its report on ‘Trends in Agency Assisted Employment in the Western Region’ in January. This included an analysis of data for each of the seven western counties. In 2013 what proportion of the total jobs in Sligo were agency assisted?

  1. 63.2%
  2. 27.6%
  3. 15.3%

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2      Agriculture in the Western Region of Ireland is characterised by smaller farm size, poorer land quality and a higher dependence on off farm income than in many other parts of Ireland. Nonetheless agriculture remains a significant employer and makes an important contribution to the regional economy.

What is the average farm size in the Western Region?

  1. 43.7 ha
  2. 15.2 ha
  3. 26.3 ha

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3      In the latest CSO data on Income and Living Conditions (released 26th November) poverty and at risk of poverty rates are given. What is the difference between the at risk of poverty rates between the BMW and S&E regions?

  1. 5.7%
  2. 15.2%
  3. 1.3%

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4      In a recent a creative momentum project survey what proportion of creative entrepreneurs were exporting?

  1. 8%
  2. 48%
  3. 68%

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5      Examining regional indicators can help us to understand the growth and development taking place in our regions, to highlight changes and assess issues of efficiency and equity among regions.

Looking at the data since 2003 are regional disparities

  1. Widening?
  2. Narrowing?
  3. Staying the same?

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

What is the largest employment sector in the Western region?

  1. Industry
  2. Wholesale and Retail
  3. Public Administration and Defence

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7      The WDC has been highlighting rural broadband needs for more than a decade. It recently submitted its views to the consultation on the rollout of the National Broadband Plan.

What is the minimum download speed set down under the National Broadband Plan (in Mega bits per second (Mbps))?

  1. 30 Mbps
  2. 100 Mbps
  3. 12 Mbps

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8      In February 2015 the IDA published a new 5-year strategy which put considerable focus on the regional balance of future FDI investments. The strategy includes a target to increase the number of investments in every region, outside of Dublin. By how much are the investments in the regions targeted to increase?

  1. By 10-20% over the 5 years of the strategy?
  2. By 30-40% over the 5 years of the strategy?
  3. By 80-90% over the 5 years of the strategy?.

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9      With The Paris Agreement at COP21 marking a turning point in the response to climate change, it is time to consider how we will meet those targets in Ireland so we examine some of the issues for climate change mitigation in the Western Region in this post.

What percentage of households in the Western Region use oil to heat their homes?

  1. 63.1%
  2. 84.2%
  3. 38.8%

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Answers:

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  1. Assisted jobs

Answer:3) 15.3%

The WDC published a report on ‘Trends in Agency Assisted Employment in the Western Region’ in January 2015.week. This included an analysis of data for each of the seven western counties. Taking Sligo as an example in 2013, there were 3,880 people working in agency assisted jobs there. 15.3% of total jobs in the county were agency assisted, which is below the state average (19.3%). Some 55.6% of assisted jobs in Sligo are in foreign owned companies; lower than a decade earlier. Irish owned assisted employment has grown steadily since 2011 and was up 4.8% in 2013. Sligo’s second largest assisted sector – Traditional Manufacturing – has had the strongest recent growth, up a fifth (21.5%) between 2010 and 2013.

For more about agency assisted jobs in the other Western Region counties see this post

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  1. Farm size

Answer: 3) 26.3 ha

Agriculture in the Western Region of Ireland is characterised by smaller farm size, poorer land quality and a higher dependence on off farm income than in many other parts of Ireland. Nonetheless agriculture remains a significant employer and makes an important contribution to the regional economy.

The average farm size in the Western Region (counties Clare, Donegal, Galway, Leitrim, Mayo, Roscommon and Sligo) was 26.3 ha in 2010. Farm sizes are significantly smaller than in the rest of Ireland where the average farm in 2010 was 36.9 ha. Nonetheless farm size in the Western region has grown by a third since 1991 when the Western Region average was 19.8 ha with most of the growth occurring in the 1990s (almost 27% of the growth occurred between 1991 and 2000). For more information, read this post.

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  1. Poverty data

Answer: 1) 5.7%

The CSO released the latest data on Income and Living Conditions on 26th November 2015. The headline figures indicate a rise in incomes – increasing by 3.5% between 2013 and 2014, which in turn was higher than the figure in 2012. The release also provided data on poverty rates at a regional level.   Analysis of consistent poverty rates by region, which will be influenced by rural-urban patterns, shows that the rate for the Border, Midlands and Western region was 10.8% compared with 7.0% for the Southern and Eastern region in 2014. The at-risk of poverty-rate was also higher in the Border, Midlands and Western region compared to the Southern and Eastern region, 20.5% and 14.8% respectively. The difference was 5.7%.

For more on poverty and at-risk of poverty rates see this post.

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  1. a creative momentum project survey

Answer: 3) 68%.

In order to inform the development a creative momentum project activities, an online survey was circulated 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.

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 more on the survey see this post

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  1. Regional Disparities

Answer: 1) Widening

There has been a significant widening of the gap between the BMW and the S&E regions since 2008, the difference in 2012 was 48.3 points and in 2008 was 40.6 points (in 2003 it was 42.6).

Disparities in regional GVA have been increasing in recent years and have been particularly significant since 2008 while, in contrast, disparities in disposable income reduced between 2003 and 2010, but have increased since then. For more see this post

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  1. Employment sectors

Answer: 2) Wholesale and Retail.

The largest employment sector is Wholesale and Retail and the two largest employment sectors in the Western Region are Wholesale and Retail, and Industry which together account for about 30% of jobs.  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. For more information see this post

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  1. Broadband

Answer: 1) 30Mbps

The WDC in its submission to the consultation on the rollout of the National Broadband Plan suggests that one option would be to review the basic minimum standard, for both up and download speeds, every 5 years (or more frequently depending on technological change and demand requirements) and raise the minimum standard accordingly. For more from the WDC on broadband see here and here

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  1. IDA Strategy

Answer: 2) 30-40% over the 5 years of the strategy

The strategy includes a target to increase the number of investments in every region, outside of Dublin, by 30-40% over the lifetime years of the strategy. With Dublin maintaining a similar level to currently. For example for the West, which received 71 investments over the 2010-2014 period, the target is to achieve 92-99 investments over 2015-2019. For the Border region the target is 61-66 investments (it received 47 in the past five years). These targets do not just refer to new name investments, but include expansions by existing FDI companies and R&D investments.

Read more about it here.

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  1. Climate change

Answer: 1) 63.1% of homes use oil as their main heating fuel

The pattern of fuel usage in central heating is very different in the Western Region and the rest of the state. This is primarily due to the lack of access to natural gas across most of the region. Less than 5% of households in the Western Region use natural gas to heat their home compared with 40% in the rest of the state. Lack of access to natural gas makes the Western Region far more reliant on other fuels, many which have higher carbon emissions. Oil is used by 63.1% of households in the region compared to 38.8% in the rest of the state. Wood fuels and other biomass are slightly more important in the Western Region 1.4% compared to 1.3% in the rest of the state but there needs to be a significant policy focus using renewable energies for domestic heating. These include solid biomass (wood chips, pellets and logs). In many rural situations users have more space and fuel can be sourced locally with less transport required, so these options may be more suitable than for urban dwellers. Uptake could be improved with appropriate, targeted incentives.

For more on rural urban differences, western region statistics and the need for climate change mitigation to focus on rural areas see this post.

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How well did you do?

You got 8 or 9 answers correct

CONGRATULATIONS! You really know a lot about regional development, the Western Region and the Western Development Commission’s work.

 

You got between 4 and 7 answers correct

WELL DONE, a good score but some deficiencies in your knowledge. Perhaps you should read the WDC Insights posts more carefully in 2016!

 

You got between 0 and 3 answers correct

OH DEAR! Time to pay more attention to regional development and Western Region Issues. You’ll have to do some extra study over the holiday! Reread the WDC Insights blog and check out the WDC publications page and re-take the quiz in the New Year!

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Helen McHenry

Survey shows 60% of creative entrepreneurs working on their own

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

WDC presents on Creative Economy to JOC

The WDC was invited to present to the Joint Oireachtas Committee on Jobs, Enterprise & Innovation on its work in developing the Creative Economy. On Tuesday 21 April, the WDC as well as NUI Galway, Teagasc, the Design & Crafts Council of Ireland and TG4 presented on the potential for job creation, innovation and balanced economic development in the creative sector.

The WDC has worked with this sector since 2008. At that time, after the collapse of the building sector and its knock-on impacts across the domestic economy, there was a clear need to identify and support new sources of regional economic growth and job creation. The creative industries sector was in many ways an obvious choice for the region as it is mainly made up of self-employed or micro-enterprises with people quite embedded in their local area. The sector was showing strong growth internationally and could create jobs and contribute to tourism, including in rural areas.

As there was little research in Ireland at the time, the WDC commissioned Creative Sector Baseline Report 2008 (PDF 2.5MB) to investigate the size and nature of the region’s creative sector and to identify its key issues. The Creative West 2009 (PDF 1.9MB) report found that there were 4,800 businesses in the creative sector in the Western Region, employing 11,000 people and generating €534m in annual turnover, directly contributing €270m to the Gross Value Added of the regional economy.   There was limited export activity however with two-thirds not engaged in any exporting. The majority of those in the sector were self-employed with 40% working alone and almost 90% being micro-enterprises.

Quality of life and inspiration from the region’s landscape and culture were among the strongest motivators for creative people to live and work in the Western Region. They faced a number of constraints however that can be addressed by policy and enterprise supports. Chief among these are high bandwidth broadband for creative enterprises operating in rural areas, difficulties in finding and recruiting specific skills, and quite limited networking with others in the sector and wider business community.   Creative businesses often do not fit easily into the eligibility criteria for enterprise funding and may find it difficult to access finance.

The report set out a series of recommendations for developing the sector in the region which have formed the basis of the WDC’s activities to support the sector. Under Creative Edge  (a €1.2m transnational EU-funded project, 2011-2013) the WDC developed the MyCreativeEdge.eu website to provide an online showcase for creative enterprises, with over 550 now profiled on the site. The new 3-year, €2m Creative Momentum project will further develop new routes to export markets for creative enterprises, as well as providing international networking opportunities with creative enterprises from Northern Ireland, Iceland, Sweden and Finland. The WDC Micro-Loan Fund: Creative Industries  provides loans of €5,000-€25,000 to creative enterprises and to date has funded 12 creative enterprises across the Western Region.

Nationally the Action Plan for Jobs identified the creative sector as one of the key sectoral opportunities for economic growth and job creation in Ireland. As the new Action Plan for Jobs – Regional process develops, it is important that the potential of the creative industries to contribute to sustainable job creation and enterprise growth at a regional level be recognised and the sector supported. Under the Creative Edge project the Whitaker Institute at NUI Galway developed the Creative Edge Policy Toolkit which set out a number of recommendations on policy actions that could be taken to support the sector’s growth. This could provide a useful input.

The Commission for the Economic Development of Rural Areas (CEDRA)  has also identified creative industries as a key growth sector for rural economic diversification and recommended the development of a coordinated strategy for the sector that places specific focus on its potential to contribute to the rural economy. Such a coordinated strategy however needs to be worked out through sector-specific policies and actions in the areas of enterprise support, job creation, culture, skills development and regional economic development to make a meaningful contribution.

A full transcript of the discussion at the JOC can be found here

Pauline White

The Western Region’s Labour Market

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