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200th WDC Insights blog post – Our Top 5!

It is hard to believe but this is our 200th post since the Policy Analysis team’s WDC Insights blog was first launched on 25th July 2014. Over the last (almost) five years and 200 posts we have addressed everything from labour market to climate change, broadband to county incomes, demography to electricity and much more in between.

We’ve tackled mysterious questions (Understanding rural transport statistics: Why are there so many new cars in county Roscommon?[1]) and pressing issues (Energy and Climate Action- the WDC View of the Draft National Plan); assessed the regional impacts of national trends (Leprechauns in Invisible Regions: Regional GVA (GDP) in 2015) and policies (WDC submission to Ireland 2040-Our Plan, the Draft National Planning Framework); analysed Census data (Census 2016: Housing In Ireland – What has been happening in the Western Region?) and explained changing statistical classifications (Nuts about NUTS!). And of course there’s our annual Christmas Quiz!

So of our 200 posts so far, what have been the most popular…?

Number 5: How are we doing?  GDP of Irish Regions in 2014

From April 2017, How are we doing?  GDP of Irish Regions in 2014 by Dr Helen McHenry is among our annual posts analysing CSO data on county incomes and regional GDP.  The analysis in this post showed the increasing dominance of Dublin and the South West in terms of their combined share of national GDP, with the share accounted for by other regions reducing over time, a trend that has continued.

Number 4: Preliminary Results of Census 2016 for Co Roscommon

Presenting our analysis to stakeholders is a key part of the work of the WDC’s Policy Analysis team and Preliminary Results of Census 2016 for Co Roscommon, from December 2016, summarised the main points from a presentation by Pauline White to the Roscommon Local Community Development Committee (LCDC). It outlined the key preliminary Census results for the county on population and the components of change.  Of course, these results have since been superseded by the final Census results, but it seems fitting this is in our Top 5 given that Roscommon is the WDC’s ‘home’.

Number 3: What is Rural?

It might seem like a simple question, but the popularity of this post by Dr Helen McHenry from October 2017 shows that defining What is Rural? is far more complex that you might think. The post explores differing definitions of ‘rural’ used by the CSO, the National Planning Framework and the Commission for the Economic Development of Rural Areas. It concludes by asking if we need ‘rural policy’ or policy for people living in rural areas?

Number 2: Census 2016: Rurality, Population Density and the Urban Population of the Western Region

Examining the population living in rural areas (using the CSO definition!), population density across western counties and the population of towns in the region, Census 2016: Rurality, Population Density and the Urban Population of the Western Region from May 2017 provides a handy overview of the distribution of the region’s population.  It highlights that the region’s highly rural nature, with a dispersed population and a large number of small and medium-sized towns, has important implications for the delivery of services and infrastructure to residents of the Western Region.

And finally …

Number 1: Balanced regional development – What does it mean?

In our most popular post (by a long way!) Balanced regional development – What does it mean? Deirdre Frost explored the differing definitions and uses of this much used (and abused?) term.  Written in May 2015, when the initial discussions were underway for the National Planning Framework, as a successor to the National Spatial Strategy, it concluded … ‘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.’   Whether the final NPF actually achieved this clarity is perhaps a topic for a future post …

So, 200 posts done and we are looking forward to the next 200.  We hope you have found (at least some of) them useful and of interest.  If you have, forward them to your friends!  And if there are any issues you think we should cover in future posts, just let us know policyanalysis[at]wdc.ie

All the best

Pauline, Deirdre & Helen

[1] The answer’s here

Changing times! Looking back twenty years in the Western Region

The Western Development Commission (WDC) recently published its strategy for the next five years 2019-2024 ‘Work Smarter Live Better’.  It was launched in Ballinasloe on 15th April, and that launch provided us with an opportunity to look back at how the seven county Western Region has changed since the WDC was set up.

The WDC was established by the Western Development Commission Act in 1998 so it is interesting to consider the changes experienced by the Region since the WDC came into being.  As the seven counties (Donegal, Sligo, Leitrim, Mayo, Roscommon, Galway and Clare) which make up the Western Region (the area under the remit of the WDC) do not align with other statistical regions for data collection, the best Western Region data comes from sources which publish data by county, such as the Census of Population, which allow us to combine county data to get statistics for the Western Region.  Comparing the Censuses of 1996 and 2016 gives a good picture of change in the Region over two decades.  It is not often we look back so far but it is a useful exercise, highlighting how much has changed in twenty years.

In this post I briefly consider changes in population and demographics, labour force, employment, and finally, income.  There are many other areas which merit examination which will be covered in a future post.

 

The Western Region population.

Looking first at population change, in 1996 the population of the Western Region was 657,231.  By 2016 after a very significant 26.1% increase, it was 828,697.   Different counties grew at very different rates, showing (Figure 1) the uneven rates of development and change.

The largest population growth in the period was in Galway, which grew by more than a third (36%) and the smallest population growth was in Mayo (17%) and Sligo (17.4%).

Figure 1: Population Change in Western Region counties 1996-2016

Source: CSO Statbank E2001: Population at Each Census 1841 to 2016 by County, Sex and Census Year

 

Demographic change

The make up of the population has also changed over that period.  In 1996 13.7% of the Western Region population was over 65 and 3.3% was over 80.  By 2016, 15.4% were over 65 and over 65 and 3.7% over 80.

More significant changes occurred in the younger age categories, in 1996 24% were under 15 while 41% were under 25 and by 2016 this had changed to 21.1% under 15 and 33% under 25.

 

Employment and the Labour Force

The labour force has grown even more significantly than the population.  There were 266,102 in the labour force in the region in 1996 and this had grown to 387,770 by 2016, a 46% increase.  The percentage of the population (aged 15-65) in the labour force was 53.5% in 1996 and had increased to 59.3% by 2016.  This increase is largely the result of higher female participation and also reflects the changing age demographic.

Skills have also changed considerably.  In 1996 in the Western Region only 16.7% had a third level qualification but by 2016 39.2% did.

My colleague Pauline White is currently undertaking a detailed analysis of employment by sector in the region and has published on six sectors.  Looking at key Western Region sectors, the significant changes in employment are noted  here.

In 1996 15.6% were employed in Agriculture, Forestry and Fishing and by 2016 only 6.8% were.  Similarly, in 1996 19% of those in employment worked in Industry, and in 2016 13.7% did.  In contrast, in 1996 40.1% were employed in Services but by 2016 67% were.

Incomes

Finally, although the data discussed so far is from the Census of Population it is useful to consider how income has changed over the same period.  In 1996 Household Disposable Income per person was €15,032 in the Western Region (2016 prices) and by 2016 it had risen to €22,689 an increase of 51% over that period.  However, in 1996 Western Region disposable income per person was 89.2% of the State average, but by 2016 it had fallen to 83.5% of the state average.  Clearly the improvements in income have been greater in other parts of Ireland.

 

Conclusion

This short post has provided a useful reminder of how things have changed in the Western Region in the period since the WDC was set up.  A future post will focus on spatial changes in infrastructure and where people live.  Looking back, the changes that have taken place over the 20 year period examined have seemed dramatic, though many of them have taken place gradually.  It is interesting to contemplate how things will change between 2016 and 2036 but, unless the retirement age increases even more, I won’t be around to blog about them.  And perhaps blogging won’t be around either.

 

Helen McHenry

1 in 4 working in Agriculture, Forestry & Fishing in Ireland live in Western Region

The WDC has just published the sixth of its ‘Regional Sectoral Profiles’ analysing employment data for the Western Region on different economic sectors.  The latest looks at Agriculture, Forestry & Fishing and two publications are available:

Agriculture, Forestry & Fishing is a complex sector which plays many economic, societal and environmental roles.  This analysis only examines direct employment of those whose main economic activity is working in the sector, as reported in the Census.  It does not include persons who farm part-time but have another ‘main’ job or are retired.  It includes people working on farms, fishing vessels, aquaculture farms, forestry and stables but not in agri-food processing.[1]

Of everyone working in Agriculture, Forestry & Fishing in Ireland, 25.5% of them live in the Western Region, far higher than the region’s 16.6% share of total national employment.  Of all economic sectors, Agriculture, Forestry & Fishing is where the Western Region accounts for its highest share of total national employment.

Employment in Agriculture, Forestry & Fishing

According to Census 2016, 22,733 people were employed in Agriculture, Forestry & Fishing in the Western Region and it is the region’s sixth largest employment sector.[2]  The restructuring of Ireland’s economy towards services activity and high value manufacturing, as well as intensification and increased agricultural productivity, has substantially reduced the significance of Agriculture, Forestry & Fishing’s as a source of full-time employment (Fig. 1).

Fig. 1: Percentage of total employment in Agriculture, Forestry & Fishing in Western Region and state, 1996-2016

Source: CSO, Census 2016: Summary Results Part 2, Table EZ011; CSO, Census of Population 2006, Volume 7 – Principal Economic Status and Industries, Table C0713; CSO, Census of Population 2002, Volume 5 – Principal Economic Status and Industries, Table B0513; CSO, Census of Population 1996, Volume 5 – Principal Economic Status and Industries, Table A0513

The downward trend was reversed somewhat in 2011 as there was an increase in the number of people working in the sector between 2006 and 2011.  Massive construction job losses meant that some part-time farmers, who had been working in the building industry, reverted to full-time farming.  Also, job losses elsewhere in the economy increased the relative importance of this sector.  2016 saw a return to the downward trend.

This sector has consistently accounted for a higher share of employment in the region than nationally over the past two decades.  While the region and state followed similar patterns, the gap narrowed.  In 1996 the share of total employment accounted for by Agriculture, Forestry & Fishing in the region was 6.4 percentage points higher than in the state (15.6% compared with 9.2%) by 2016 the gap had narrowed to 2.4 percentage points (6.8% compared with 4.4%).

At a county level, in 2016 Agriculture, Forestry & Fishing was most important in Roscommon (9%), followed closely by Leitrim (8.6%) and Mayo (8.5%).  All other western counties have around 7% working in the sector and are considerably above the national average.[1]

Agriculture, Forestry & Fishing sub-sectors

Census data on employment in Agriculture, Forestry & Fishing is sub-divided into six separate activities.  For ease of interpretation, these have been combined here into four sub-sectors.  ‘Animals & Mixed Farming’ dominates and accounts for 88.6% of total employment in the sector in the region, a notably higher share than nationally (82.6%) (Fig. 2).  This sub-sector dominates in all counties, particularly Clare and Sligo and is least important for Donegal.

Fig. 2: Percentage of total Agriculture, Forestry & Fishing employment in each sub-sector in Western Region and state, 2016

Source: CSO, Census 2016: Summary Results Part 2, Table EZ011.
Due to the low numbers involved, Galway City is not included in the chart, but is included in the Western Region total.

‘Tillage, Horseracing & Other Farming’ accounts for a small share in the region (5.1%), less than half its share nationally (12.6%), reflecting the Western Region’s reliance on cattle and sheep farming.  ‘Forestry & Logging’ is the smallest in the region (2.6%).  At 6.4%, Leitrim is where ‘Forestry & Logging’ is most important to employment.

The role of ‘Fishing & Aquaculture’ in Donegal’s economy is clear.  It accounts for 14.3% of total Agriculture, Forestry & Fishing employment in the county (567 people) with Killybegs likely the main location.  Galway County (2.4%) and Mayo (2.2%) are the only other western counties with a notable share working in this activity.  The Western Region makes a very substantial contribution to this sector and is home to 43% of national ‘Fishing & Aquaculture’ jobs.[1]

Agriculture, Forestry & Fishing related occupations

People working in this sector are engaged in a range of different occupations.  In 2016, there were 24,014 people in the Western Region who reported themselves with an Agriculture, Forestry & Fishing related occupation[2] (Table 1).

The vast majority (86.9% in the Western Region) of those in Agriculture, Forestry & Fishing related occupations are farmers.[3]  At 20,880, farmers are the Western Region’s second largest single occupational group.  They dominate in all counties, most strongly Clare, Sligo, Roscommon and Galway County.  Donegal is where they account for their smallest share (76.2%) due to the strength of the fishing industry.

Table 1: Percentage in Agriculture, Forestry & Fishing related occupations in Western Region and state, 2016

Source: CSO, Census 2016: Profile 11 – Employment, Occupations and Industry, Table EB049.
Due to the low numbers involved (181 in total) Galway City is not included in the table but is included in the Western Region total.

The next largest is ‘Elementary Agricultural’ which includes unskilled occupations.  These are most important in Donegal (11.2%), with a high proportion of both farm and fishing workers.  Leitrim has the next highest share (9.3%) mainly due to forestry workers.  ‘Other Skilled Agricultural & Related Trades’ is also most important in Donegal is (11.8%) almost entirely due to skilled fishing trades, Galway County is next highest (4.3%) and for the same reason.

Conclusion

Despite declines, Agriculture, Forestry & Fishing continues to play a larger role in the region’s labour market and any changes in the sector would have a greater employment impact in the region and its rural areas in particular.  The sector is highly exposed to Brexit and it is vital that the issues and needs of this sector in the Western Region, characterised by smaller scale operations, is addressed in Brexit adaptation efforts.

The Western Region plays a strategic role in Ireland’s Fishing & Aquaculture sector.  Ireland’s seafood sector has shown strong recent growth, predominantly export-led.  Brexit however poses many challenges and addressing these will be vital to future jobs growth in this sector.  The region’s forestry resource is a valuable asset, supplying the construction industry with quality product.  The region is also well placed to further develop a wood energy sector using by-products to stimulate local job creation as well as increase renewable energy use.

Future changes in the pattern and activities carried out by the Agriculture, Forestry & Fishing sector, as a result of climate change mitigation and transition to a low carbon economy, could have significant positive and/or negative impacts on employment.  The nature and scale of such impacts is currently unclear however and will be one of the most important factors influencing this sector’s long term future.

For more, download Agriculture, Forestry & Fishing Employment in the Western Region: Regional Sectoral Profile and WDC Insights: Agriculture, Forestry & Fishing Employment in the Western Region here

Pauline White

 

[1] This regional strength is also reflected in the region’s 47.6% share of national employment in seafood processing, see WDC (2019), Industry in the Western Region: Regional Sectoral Profile

[2] This differs from the number working in the sector because unemployed persons are included in occupations data (under their last employment) but not in employment data, some people working in these occupations may work in another sector (e.g. a horticulturalist working for a landscaping company) and some people working in this sector may have different occupations (e.g. a bookkeeper at an aquaculture farm).

[3] See this WDC Insights blogpost ‘How many farmers are in the Western Region?’ for a discussion of different definitions and ways to measure the number of ‘farmers’.

[1] At 0.5% of total employment (163 people), Galway City is an exception.  Given the low numbers involved, Galway City will be excluded from much of the following analysis but it is included in the figures for the Western Region as a whole.

[1] Agri-food processing forms part of the Industry sector and was examined in a previous Regional Sectoral Profile, WDC (2019), Industry in the Western Region: Regional Sectoral Profile https://www.wdc.ie/publications/reports-and-papers/

[2] These are people who recorded in the Census that their main employment was in this sector.  Therefore someone who farms/fishes part-time but has another job (which they recorded as their ‘main’ employment) would not be included.

Changes and Trends in Disposable Incomes in Western Region Counties

The CSO has recently published data on Household Disposable Incomes at county level as part of the ‘County Incomes and Regional GDP 2016’ release.  This release contains useful trend data on incomes for counties as well as information about the levels of different household income components for each county.  Data on regional GDP, which is also part of this release, will be considered in a future post.

Here I give an overview of the 2016 Disposable Income data (and the estimates for 2017) before considering some of the changes over time.  It should be remembered that the ‘Disposable Incomes’ as discussed in this post are calculated at a macro level and the county data is most useful for comparison among counties and over time.  Indeed the CSO notes that “While the county figures involve uncertainty, they do provide a useful indication of the degree of variability at county level.”

The map from the CSO below gives a quick overview of Household Disposable Income per person in 2016.  It shows, unsurprisingly, that the highest disposable incomes are in the east and south, while counties in the west and north have the  lowest disposable incomes.   Dublin, Limerick and Kildare are the only counties where per capita disposable income exceeded the state average in 2016 although Wicklow, Cork and Waterford, were just below (see Figure 2below for more detail).

 

Source:  CSO, 2019, County Incomes and Regional GDP 2016

A summary of key data for the Western Region is provided in Table 1 below.  The data for 2016 can be regarded as more robust than the 2017 estimates and so it is used for most of the comparisons in this post.  In 2016 Disposable income per person in the Western Region was €17,934 and in 2017 it had increased to €18,128 (I have calculated the Western Region figures using inferred population estimates).

 

Table 1: Disposable income data for Western Region counties

*CSO Estimate  ^Own calculations

Source:  CSO, 2019, County Incomes and Regional GDP 2016  and CSO Statbank Table CIA02

 

Disposable income per person in Donegal is consistently the lowest in the region (and nationally) and estimates for 2017 show a small decline (-0.6%) in incomes in Donegal between the two years.  Disposable Incomes in Donegal in 2016 were only 77% of the state average.  Only three Western Region counties (Sligo, Galway and Leitrim) had disposable incomes of more than 90% of the state average, while Clare had a disposable income of 88% of the state average, Mayo 86% and Roscommon 83%.  The Western Region as a whole had a disposable income per person of 87% of the state average in 2016.

The small changes in disposable incomes between 2016 and the 2017 estimates are shown in Figure 1 below.  As noted, there was a decline in Donegal, and in Leitrim, Mayo and Roscommon the growth was less than 1%.  The most significant growth between 2016 and 2017 was in Clare (2.4%).  For the Western Region as a whole, disposable incomes showed a growth of 1.1%.  Disposable income per person in the State was €20,638 in 2016 and is estimated to have grown by 3.7% to €21,397 in 2017.  As noted, however, the 2017 data is estimated.  All counties showed more significant growth in Disposable Incomes between 2015 and 2016 (Table 1 above).  The largest growth in the region that period was in Mayo (4.6%) and Roscommon (4.4%).

 

Figure 1: Disposable Income per person for Western Region counties and the State, 2016 and 2017 (€)

*CSO Estimate  ^Own calculations

Source:  CSO, 2019, County Incomes and Regional GDP 2016

 

Disposable income per person for all Irish counties is shown in Figure 2 below.  Disposable income per person in Donegal is lowest in the state, and it is third lowest in Roscommon (Offaly is second lowest).  In contrast, Sligo has the tenth highest disposable income per person, and Galway is in eleventh place.  The highest disposable incomes nationally are in Dublin, Limerick and Kildare.   These, along with Wicklow, Cork and Waterford, all have Disposable Income per person of more than €20,000 per annum.

 

Figure 2: Disposable Income per Person for all Counties, Western Region and State.

Source:  CSO, 2019, County Incomes and Regional GDP 2016

 

Trends in Disposable Incomes over time

It is also interesting to look at changes in disposable incomes over time.  Figure 3 shows trends in disposable incomes in the Western Region between 2000 and 2016.  All of the counties show a very similar growth trajectory with rapid growth to the 2008 peak followed by rapid decline.  There was a small peak in 2012 followed by a fall in 2013 which related to a decline in social transfers as discussed here.  This decline between 2012 and 2013 which occurred in all counties, has mostly been followed by a period of growth to 2016.

 

Figure 3: Disposable Income per Person for Western Region Counties 2000-2016 (€)

Source:  CSO, 2019, Statbank Table CIA02

 

Disposable Incomes in the Western Region compared to the State

While Figure 3 shows the actual Disposable Incomes per person, when considering the trends among counties it is helpful to use indices so that county figures can be examined relative to the State (State=100).  Thus Figure 4 provides a contrast to the more positive growth trend indicated above in Figure 3 which showed growth in disposable incomes in Western Region counties between 2013 and 2016.  Growth rates in the Western Region were lower than for the state as a whole and so Figure 4 shows that Disposable Incomes in Western Region counties are declining relative to the state average (although there is some recovery relative to the State indicated between 2015 and 2016).  Figure 4 also reminds us that Galway was the only Western Region to have had a Disposable Income of higher than the state average during this period and this was only for one year in 2010.

 

Figure 4: Index of Disposable Incomes per person in Western Region counties 2000-2016, State=100

Source:  CSO, 2019, Statbank Table CIA02

 

Have Disposable Incomes Recovered?

Given the significance of the peak in Disposable Incomes in 2008 it is interesting to examine how Disposable Incomes performed in 2016 relative to that peak.  Although there has been some recovery in Disposable Income since their lowest point in 2013, Disposable Income per person in 2016 was below that for 2008 in all of the counties in Ireland (Figure 5).   Indeed for seven of the counties Disposable income was over than €4,000 per person less in 2016 than it had been in 2008.  Two of these counties (Roscommon and Clare) are in the Western Region.  As was shown in Table 1 above Disposable Income in 2016 was more than 20% lower in Roscommon (€4,401) in 2016 than it had been in 2008, while in Clare it was more than 19.1% less (€4,277).  Most significantly, in Meath incomes were €5,544 higher in 2008 than in 2016.

 

Figure 5: Difference in Household Disposable Income per person in 2008 and 2016

Source:  CSO, 2019,  Statbank Table CIA02

 

In contrast, Limerick is the county showing least difference in disposable income per person in 2008 compared with 2016 (- €321).  Dublin and Kerry have also recovered relatively well, although there is still a significant difference between Disposable Incomes in these counties in 2016 and 2008.  Of the Western Region counties Sligo has recovered best, with disposable incomes only 8% below that in 2008 (€1,746).  Interestingly, Donegal (14% less) and Mayo (13%), which are among the Western Region counties with the lowest Disposable Incomes per person, also show a less significant gap to 2008 than other Western Region counties.  However, it is of concern that disposable incomes in all counties are still considerably lower than they were in 2008.  While the Irish economy has recovered well in the last few years, this has not fed through to disposable incomes as measured in this data.

The differences in disposable incomes among counties can be explained by the changing patterns in the components of household incomes (as was discussed here and here).  I will examine trends in these in the most recent data on income components in a future post.  The growth and change in the regional economies as shown by the Regional GVA data will also be examined in a future post.

 

Helen McHenry

 

 

Hospitality plays a larger role in employment & enterprise in the Western Region

The WDC has just published its latest Regional Sectoral Profile which examines the region’s fifth largest employment sector – Accommodation & Food Service.  Both the detailed report ‘Accommodation & Food Service Sector in the Western Region: Regional Sectoral Profileand a two-page summaryWDC Insights: Accommodation & Food Service Sector in the Western Region’ can be downloaded here

Accommodation & Food Service includes all those working in hotels, guesthouses, pubs, clubs, restaurants, takeaways, coffee shops, catering companies and mobile food / coffee vans.  Essentially it is the hospitality industry.  The Western Region is home to 19.7% of everyone working in hospitality in Ireland and 23.7% of all of the sector’s enterprises.

Accommodation & Food Service as a share of total employment 

According to Census 2016, 23,038 people were employed in Accommodation & Food Service in the Western Region.  It plays a greater role in the region’s labour market than nationally (Fig. 1) accounting for 6.9% of total employment compared with 5.8%.  Among western counties, it is most important in Galway City at 9.9%, followed by Donegal and Mayo.  These three counties are among the top five in Ireland in terms of the share of their workforce engaged in hospitality.  Roscommon has the lowest share in the region and is fourth lowest in the state.

Fig. 1: Percentage of total employment in Accommodation & Food Service in Western Region and state, 2016

Source: CSO, Census 2016: Summary Results Part 2, Table EZ011

At 27.6% of total employment, Clifden has the highest share working in hospitality of Ireland’s 200 towns and cities (1,500+ population) with Bundoran (21.7%), Westport (21.1%), Donegal town (20.3%) and Carrick-on-Shannon (15%) also among the top 10 towns in Ireland.   At under 6%, Ballyhaunis, Ballymote and Boyle have the lowest shares working in the sector in the region.

Employment by gender 

Hospitality is a more important employer for women than men (Fig. 2) with 8.2% of all working women and 5.8% of all working men in the Western Region working in the sector.  The sector plays a more significant role in both female and male employment in the region than nationally, most notably for women.

Galway City, Donegal and Mayo are where hospitality is most important for female employment employing close to 1 in 10 of all women.  In the case of Donegal and Mayo the sector is considerably more important for women’s jobs than men’s.  Galway City is the only area where hospitality is more important to male than female employment however the shares are quite similar indicating the sector is more gender-balanced, as it also seems to be in Sligo.

Fig. 2: Percentage of total male and total female employment that is in Accommodation & Food Service in Western Region and state, 2016

Source: CSO, Census 2016: Summary Results Part 2, Table EZ011

Self-employment in Accommodation & Food Service

14.1% (3,237 people) of people working in the sector are self-employed (employer or own account worker). The Western Region has a considerably higher incidence of self-employment than the national average (11.5%).  This could indicate that hospitality operations in the Western Region tend to be smaller in scale with fewer employees and that owner-manager/family-run businesses are more common.  The extent of self-employment declined between 2011 and 2016, most strongly in more rural counties.

Accommodation & Food Service Enterprises

In 2016 there were 4,358 Accommodation & Food Service enterprises registered in the Western Region which was 23.7% of all such enterprises in the state.  This is the sector where the region accounts for its highest share of all enterprises nationally.

Hospitality accounted for 10.2% of all business economy[1] enterprises registered in the Western Region 2016.  Donegal, Leitrim and Mayo have the highest share of enterprises in the sector at 11+% showing the importance of the sector in their overall enterprise profile.

Key Policy Issues for the Western Region’s Hospitality Sector

Accommodation & Food Service plays a larger role than nationally in the Western Region’s economy, in terms of its employment profile and enterprise base.  Any changes in demand for this sector e.g. from Brexit, an economic downturn, will have a particularly large impact on the region and national policy needs to address issues specific to the region such as improved accessibility for visitors and the viability of rural hospitality businesses relying on local demand.

As it is quite widely distributed, hospitality helps to sustain the regional and rural economy and is becoming an increasingly important reason for people to visit town centres. Therefore it is a critical element in town centre renewal efforts.  It is also an important source of jobs for those with lower skills or limited experience, whose rights need to be protected, as well as providing highly skilled occupations and considerable opportunities for entrepreneurship.  Self-employment, while still higher in the region than elsewhere, is declining and it is important to support and encourage self-employment to maintain the diversity of the region’s hospitality offering.

Hospitality is highly sensitive to changing economic conditions which influence both the level of disposable income of local residents and overseas and domestic tourism activity. The balance between local and tourist demand in sustaining the hospitality sector varies considerably across the region (from tourism ‘hotspots’ to small rural towns depending on local custom) and policy aimed at strengthening the sector needs to be tailored to the specific circumstances of different areas.  Rural and border counties are particularly exposed to Brexit while the sector as a whole needs to adapt to emerging trends e.g. Airbnb, changing demographics, low carbon economy.

Download Accommodation & Food Service Sector in the Western Region: Regional Sectoral Profile and WDC Insights: Accommodation & Food Service sector in the Western Region here

The report also examines data on overseas and domestic tourism revenue and numbers to the Western Region, which will be the subject of a future post.

 

Pauline White

[1] Business economy includes all economic sectors except Agriculture, Forestry & Fishing, Public Administration & Defence, Education, Health & Social Work and Other Services.

Industry’s role in total ‘agency assisted’ jobs declining nationally but remains highly stable in Western Region

In a recent post I outlined some of the main findings from our analysis of Census employment data on the Industry sector in the Western Region.   Our recent report ‘Industry in the Western Region: Regional Sectoral Profile’ also examined agency assisted Industry jobs and they are the subject of this post.

Each year the Department of Business, Enterprise & Innovation (DBEI) (and formerly Forfás) conducts a survey of all firms in Ireland who have ever received assistance from IDA, EI or Udarás na Gaeltachta.  This is published as the Annual Employment Survey (AES) and these firms are referred to as ‘agency assisted’.  They are limited to Industry or International Services firms currently or with the potential to export.  For Industry this would include most enterprises.   Unlike Census data, which is based on where a person lives, AES data is based on where the company is located, so is the location of the job, even if the person travels from another county.

Agency assisted jobs in Industry in the Western Region

The latest AES data is from 2017 when there were 49,435 agency assisted Industry jobs in the Western Region.  From a low of 38,000 in 2010, assisted Industry jobs have grown steadily, accelerating since 2013.

Of total assisted Industry jobs in the region, 87.6% are Permanent Full Time (PFT) with the rest ‘Other Jobs’ (temporary, part-time or contract).  The share of PFT jobs in the region is lower than nationally (89.5%) indicating that other forms of employment are more common in the region’s industrial sector.   The share of jobs that are PFT declined over the decade from 92.2% in the state and 90% in the region in 2008 indicating a rising prevalence of other forms of employment.  Every western county, except Donegal, had a lower share of PFT assisted Industry jobs in 2017 than a decade earlier.

Industry’s share of total assisted jobs

In the Western Region, the share of total assisted jobs (Industry + International Services) accounted for by Industry has remained extremely stable at around three-quarters over the past decade (Fig. 1). This contrasts strongly with a steady decline nationally from 64.2% in 2008 to 55.6% by 2017.  International services account for a far higher and growing share of assisted jobs nationally than in the region, where Industry continues to play a greater role.

Due to confidentiality reasons, data on assisted jobs at county level is combined for Leitrim, Roscommon and Sligo.  In 2017, this is where Industry accounts for its highest share of assisted jobs (88.6%). There has been a considerable increase in Industry’s importance, partly due to substantial job losses in international services over this period.[1]  Mayo has the next highest share (87.3% in 2017) in Industry with a number of significant Irish and multinational manufacturing plants but limited international services activity.

In Galway, Industry’s share declined markedly between 2009 and 2012 but has remained relatively steady since as its growth in Industry and international services jobs has been similar (29.2% in Industry and 25.2% in international services during 2012-2017). While there has been fluctuation in the relative importance of Industry in Clare, by 2017 73% of Clare’s assisted jobs were in Industry, the same share as a decade earlier.  Industry’s role in Donegal declined throughout the period, partly due to very strong growth in international services as well as manufacturing job losses.  At 61.8% Donegal has the lowest share of Industry jobs in the region but is still above the state average.

Fig. 1: Industry as a percentage of total assisted jobs in Western Region and state, 2008-2017

Source: Department of Business, Enterprise & Innovation (2018), Annual Employment Survey 2017, special run. Note: For ease of interpretation the vertical axis starts at 50%.

Assisted jobs in Industry sub-sectors

MedTech dominates assisted Industry jobs in the Western Region (Fig. 2) accounting for 29.7% of all such jobs in the region compared with 13.3% nationally.  For the country as a whole, Agri-food is by far the largest assisted Industry sector.  As well as Agri-food, the region also has a notably lower share involved in the high-tech Chemicals & Pharma and Computer & Electronic sectors.

Fig. 2: Percentage of total assisted jobs in Industry in each sub-sector in Western Region and state, 2017

Source: Department of Business, Enterprise & Innovation (2018), Annual Employment Survey 2017, special run

During 2012-2017 the region performed considerably better than nationally in the region’s three strongest growing sub-sectors (Fig. 3).  Valeo in Tuam would be a key factor in the strong growth in Transport Equipment, while recovery in the building industry drove the next highest growing sub-sectors.  In many other sub-sectors, jobs growth in the region was relatively similar to the national experience.  It did have a notably stronger performance in Clothing & Textiles while there was a decline in Mining & Quarrying jobs in the Western Region compared with growth nationally.

Fig. 3: Percentage change in assisted jobs in Industry sub-sectors in Western Region and state, 2012-2017

Source: Department of Business, Enterprise & Innovation (2018), Annual Employment Survey 2017, special run

Assisted Industry jobs by ownership

Of total assisted Industry jobs in the Western Region in 2017, 55.1% (27,214) were in foreign owned companies, higher than the 45.3% share nationally.

During the early years of the recession (2008-2012), the share in foreign ownership increased substantially (from 52.7% to 55.8%) due to large job losses in predominantly Irish owned sectors supplying construction, as well as jobs recovery beginning earlier in the foreign owned sector, strongly influenced by the performance of MedTech.  While jobs growth has extended more widely in the Irish owned sector, the share jobs in foreign ownership remains at a higher level than pre-recession.  Foreign ownership is not only more important to Industry in the Western Region, but the recession further strengthened its role.

The ownership pattern differs across Industry sub-sectors.  At 96.8% of assisted jobs in foreign ownership MedTech is very heavily reliant on FDI companies with large employers such as Medtronic, Boston Scientific and Abbot.  Transport Equipment, which has shown strong jobs growth, has the next highest level of foreign ownership at 84.4%.

In terms of Irish ownership, all assisted jobs in Mining & Quarrying and practically all (98.2%) in Clothing & Textiles, is in Irish owned firms.  For Clothing & Textiles, the loss of previous foreign owned jobs in the sector e.g. Fruit of the Loom in Donegal, and the changing character of the sector to focus on high value, hand crafted products e.g. Magees of Donegal, Foxford Woollen Mills, means it is now largely an indigenous industry.  Agri-food has the next highest level of Irish ownership at 85% of assisted jobs.

Conclusion

Industry plays a considerably more significant role in agency assisted employment in the Western Region accounting for 3 in 4 of all assisted jobs.  While Industry’s share is declining nationally, it is highly stable in the region with its strong Life Sciences cluster a contributing factor.

While Industry’s share of assisted jobs has remained highly stable, there have been many changes within the sector over the past decade including a growing share of non-permanent jobs and the increased significance of foreign owned employment.

Greater diversity in the industrial profile of a region increases its resilience and capacity to withstand external shocks.  The region’s greater reliance on foreign ownership and the dominant role of Life Sciences (while a key regional asset) could increase the region’s exposure to risk.  There needs to be a strong policy focus on further embedding existing regional strengths while also developing new areas of growth e.g. Energy, Transport Equipment, advanced engineering, to further diversify the region’s industrial profile and increase its resilience.

More detailed analysis of agency assisted employment in Industry in the Western Region is provided in Section 3 of ‘Industry in the Western Region: Regional Sectoral Profile’.

Pauline White

[1] The numbers employed at the former MBNA (now Avantcard) call centre in Carrick-on-Shannon reduced substantially over this period, as well as a number of call centre closures in Sligo.

The Education Sector in the Western Region

The WDC recently published the third in our ongoing series of ‘Regional Sectoral Profiles’ analysing employment and enterprise data for the Western Region on specific economic sectors and identifying key policy issues. The new report examines the Education Sector, the Western Region’s fourth largest employer.

The full report ‘The Education Sector in the Western Region: Regional Sectoral Profile’ and the two-pageWDC Insights: The Education Sector in the Western Region’, which summarises the key points, can be downloaded here

The Education sector plays a vital role in society, educating our young people, providing lifelong learning and personal development opportunities, as well as the necessary skills for the economy. It includes all those working in public, private or community/voluntary pre-primary, primary and secondary schools (e.g. teachers, support staff) as well as staff of further and higher education institutions and colleges. The sector also includes other types of educational activity such as music schools, adult education and driving schools.  Discussions of the Education sector generally focus on provision of services. This ‘Regional Sectoral Profile’ however focuses on its role as a key economic sector and regional employer.

Employment & Enterprise in the Education Sector

A few of the key findings from the report on employment and enterprise in the sector include:

  • 32,349 people were employed in the Education sector in the Western Region in 2016. Education plays a greater role in the region’s labour market than nationally, accounting for 9.7% of total employment compared with 8.8%.
  • Education is most important in Donegal (10.8% of all employment), followed by Galway County (10.2%). These are the highest shares working in Education in the country.
  • Moycullen in Co Galway (19%) has the highest share of residents working in Education across Ireland’s 200 towns and cities. The towns with the next largest shares in the region are Bearna (13.3%), Strandhill (12.2%) and Carndonagh (11.9%). It must be noted that this data refers to residents of the towns, although some may travel to work elsewhere e.g. NUI Galway, IT Sligo.
  • The number of people working in Education in the Western Region grew by 4.4% (2011-2016), weaker growth than the sector nationally (5.7%) and also weaker than total employment growth in the region (7.5%).
  • At 32.2% and 25% of total Education employment respectively, ‘Primary’ and ‘Secondary’ are the two largest Education sub-sectors, with a higher share working in both in the region than nationally. In contrast the region has a lower share working in ‘Higher Education’ (15.2% v 16.8%).
  • ‘Pre-primary Education’ saw the strongest jobs growth, +44.8% in the region (2011-2016) largely driven by introduction of the Early Childhood Care and Education (ECCE) Scheme providing a free pre-school place to all children.
  • 7% of all working women and 4.4% of all working men in the Western Region work in Education. The sector plays a more significant role in both female and male employment in the region than nationally.
  • In 2016 there were 2,710 Education enterprises registered in the Western Region. Education enterprises account for 5% of all enterprises in the region, above the 4.4% share nationally.  Sligo is where the sector accounts for the largest share of enterprises (5.5%) with Clare and Galway next highest (5.2%).

Key Policy Issues for the Western Region’s Education Sector

  • Higher reliance on the Education sector in the Western Region: Education is a more significant employer in the Western Region than nationally and plays a critical role in providing professional career opportunities, including in more rural areas where there may be fewer alternatives. While the main focus for Education policy must be the provision of quality services, the sector’s parallel employment role should also be a factor in policy decisions.
  • Central role in female employment: 3 out of 4 people working in the Education sector in the Western Region are women. Galway City has the lowest female share, and Roscommon and Leitrim have the highest, indicating that Higher Education has lower female involvement than other Education sub-sectors. Any future development in Education will have a far greater impact on female than male employment levels.
  • Demographic Factors: The most recent projections from the Department of Education and Skills indicate that primary school enrolments peaked in 2018, while for second level education the numbers are projected to peak in 2024. The expected decline in demand for primary and secondary education in the medium-term will impact on future Education employment trends. Demand for third level education is more varied. As well as direct transfers of young people from secondary school, demand also comes from mature students returning to education and from international students, while staff are also engaged in other activities e.g. research, which are separate to student enrolments.
  • Lifelong Learning: There is increasing recognition of the importance of lifelong learning and the need to continually update skills, or acquire new skills, to adapt to changing technology and an increasingly flexible labour market. As well as the demands of the labour market, lifelong learning is also pursued for personal development. There are regional differences however in participation in lifelong learning. In the Border region, just 5% of adults were engaged in formal education, in the West region it was 8% while it was highest in Dublin at 12%. Meeting the Government’s target of 10% of adults to be engaged in formal lifelong learning by 2020 (15% by 2025), particularly in the Border region, will require a very substantial increase in participation representing a growth opportunity for the Western Region’s Education sector.
  • Regional Skills: The Education sector is largely responsible for providing skills needed by the regional economy; skills needs which are continually changing. Provision of regional skills involves a wide range of education providers and close engagement with employers. Regional Skills Fora provide a useful structure. Changing skill demands impact on Education employment, as emerging skill needs can only be met if Education professionals with expertise in these new areas e.g. artificial intelligence, big data, are available.
  • Emerging Opportunities: The introduction of the ECCE had a very dramatic jobs impact on Pre-primary Education. This shows the potential for developing new opportunities in the Education sector, where job creation may not be the main objective but is nonetheless an important outcome. Brexit presents another potential opportunity. It is estimated that 10,000 students from the Republic of Ireland study in Northern Ireland or elsewhere in the UK and institutions such as Letterkenny IT and IT Sligo in the Western Region, could attract some of these students. Also students from EU member states wishing to study abroad in an English-speaking country are more likely to choose Ireland following Brexit. Another opportunity is the Western Region’s growing number of retired people who represent potential new demand for Education services. Given demographic trends, increased demand for Education services from adults, including retired people, is an area of potential growth.

Download the full report ‘The Education Sector in the Western Region: Regional Sectoral Profile’ and the two-page WDC Insights: The Education Sector in the Western Region’ which summarises the key points, here

Pauline White

A year in review: WDC Policy Analysis 2018

Happy New Year from the WDC Policy Analysis team!  As we all try to settle back into work and look forward to 2019 (well as much as anyone can with Brexit looming large on the horizon) it’s a good chance to look back at the year that was 2018.

Here’s a few of our highlights:

Travel to Work analysis

In May, we published detailed analysis of the travel to work patterns of workers living in the Western Region. The analysis, undertaken by the All Island Research Observatory (AIRO), identified 42 labour catchments across the region.

Our report contains a detailed labour market profile of the principal town in each of the seven counties – Galway, Ennis, Sligo, Letterkenny, Castlebar, Roscommon and Carrick-on-Shannon. All of these labour catchments have significantly more people at work than the resident population of workers in the town, highlighting that they have access to a larger labour supply than may be thought. Read more

Further analysis of 26 smaller labour catchments will be published later in January.

County Infographics

July saw one of our most popular outputs, ‘snapshot’ infographics for each of the seven western counties.  The infographics show a range of facts about each county such as its 2016 population as a percentage of its 1841 population, the percentage with a third level qualification, average time to travel to work and broadband access.  Read more

WDC Insights

During 2018 we continued to publish succinct, 2-page WDC Insights on a range of issues including Electricity Transmission for Renewable Generation, Enterprise in the Western Region 2016, County Incomes in the Western Region, Growth and Change in Regional GVA and Education Levels in the Western Region.

Regional Sectoral Profiles

October 2018 saw the launch of a series of Regional Sectoral Profiles of economic sectors in the Western Region, analysing the latest employment and enterprise data and drawing out key policy issues.  A detailed report and WDC Insights summary is published for each sector.

The first examined was Wholesale & Retail which employs just over 42,000 people in the Western Region, this was followed by Health & Care which employs a similar number.  The next in the series, on the Education sector, will be published later in January.

Policy Submissions

One of the big work areas in any year is making submissions to national and regional policy consultations and 2018 proved particularly busy on the submissions front.

The year kicked off with submissions on the Issues Paper published for both the Northern & Western and Southern Regional Spatial and Economic Strategies (RSES).  Following the consultation period in early 2018, the Draft RSES documents are currently open for public consultation and we’ll be updating on the WDC’s submissions shortly.

Other submissions during 2018 included EirGrid’s Electricity Transmission Development Plan 2017-2027, Seanad Consultation on SMEs and the National Digital Strategy among others.

City-Led Development & Peripheral Regions

In September the WDC sponsored the Annual Conference of the Irish Branch of the Regional Studies Association.  The programme featured two international keynote speakers: from the US Prof. Mark Partridge and from Scotland Dr Andrew Copus.  Both focused on different aspects of the interaction between rural and urban areas.  The day also included a range of presentations from Irish academics and policymakers including WDC Policy Analyst Dr Helen McHenry.  A report on the conference appeared in the Winter edition of the Local Authority Times.  Read more

WDC Insights Blog

We continued to post an (almost!) weekly blog throughout the year with posts on all of the above publications, outputs and activities.  Other topics ranged from Nuts about NUTS and How many farmers are in the Western Region? to Leprechauns in Invisible Regions, Caring for the West and Is e-working on the increase?

To keep up to date with new WDC Policy Analysis outputs published during 2019, sign-up to our Mailing List.  To receive our weekly WDC Insights Policy blog by e-mail, follow the blog. And to follow us on Twitter we’re @WDCInsights.

And if you want to get in touch with any of us directly, we’re firstnamelastname@wdc.ie

Looking forward to working with you in 2019.

Deirdre Frost, Helen McHenry & Pauline White

WDC Insights Christmas Quiz Time Again! Take the 2018 quiz now.

It’s the WDC Insights Christmas Quiz time again.  How much do you know about the Western Region and regional development issues?

Take the quiz now or save it for ‘light reading’ over the holiday…. Or take it in January to inspire you for 2019.

Whenever you do take it, I hope you enjoy it and learn from it.  Thanks to all our blog readers this year.  We hope you have found it interesting, informative and, occasionally fun (rarely you might say…) . See you next year!

The answers are at the end with links to more information and the relevant posts.

You can add up your score and see what it says about your knowledge (and personality).

 

Good Luck!

1       The Western Region  

The Western Development Commission (WDC) is a statutory body that was set up to promote, foster and encourage social and economic development in the Western Region

How many counties are under the remit of the Western Development Commission?

  1. 9
  2. 11
  3. 7

2      Caring for the West

The Western Region is home to 19% of all carers in the State, higher than its 17.4% share of the national population, showing the greater need for, and provision of, unpaid care in the region.

What proportion of the Western Region population recorded themselves as providing unpaid care in census 2016?

  1. 6.3%
  2. 2.8%
  3. 4.5%

3      Disposable Incomes in the Western Region, 2015

According to the CSO data for 2015 (released in 2018), which county in the Western Region had the highest disposable income per person?

  1. Sligo
  2. Galway
  3. Clare

4     The Creative Sector

The WDC has been working on the development of the creative economy for more than ten years, with analysis and projects to stimulate its development.

What is the average number of workers in creative enterprises in the Western Region?

  1. 4 employees per firm
  2. 6 employees per firm
  3. 3 employees per firm

  1. Nuts about NUTS

Much of the data used by WDC Insights at regional level is provided at NUTS 2 and 3 levels.

How many NUTS 2 regions are there in Ireland?

  1. 5 NUTS 2 regions
  2. 3 NUTS 2 regions
  3. 2 NUTS 2 regions

6 Renewable Electricity Generation

The Western Region has some of the best resources for on renewable energy in Europe.  The WDC has continued to highlight the opportunities and needs of this sector.

What proportion of the electricity generation capacity in the Western Region is from renewable sources?

  1. 49.5%
  2. 73.2%
  3. 40.9%

7      Broadband

The WDC has been highlighting rural broadband needs for more than a decade. It is a particular issue for our largely rural region.

What proportion of SMEs in Connacht and Ulster rate their internet connection as ‘poor’ or ‘very poor’?

  1. 73%
  2. 25%
  3. 34%

8      Enterprise in the Western Region

In September the WDC Insights publication.  ‘Enterprise in the Western Region 2016’ analysed the latest data from the CSO’s Business Demography which measured active enterprises in 2016.

How many enterprises were registered in the Western Region in 2016?

  1. 67,432
  2. 95,763
  3. 54,410

9      Farmers in the Western Region

There are three different measures of the number of ‘farmers’ in the Western Region.  The Census of Population was held in 2016, and this provides one measures of those involved in farming, data on CAP beneficiaries for 2016 provides another measure and recently released Revenue data for 2016 provides the third statistic.

Which measure shows the highest number of farmers in the region?

  1. Census 2016
  2. CAP beneficiaries
  3. Revenue data
  1. The Christmas Quiz

Why are you completing the Christmas Quiz today??

  1. You know loads about the Western Region and want to show off
  2. Your boss told you to.
  3. You are afraid Santa Claus won’t come if you don’t get a high score…

 

Answers

Don’t forget to keep count of how many correct answers you have.

 

  1. The Western Region

Answer: 3) 7 counties

The seven counties in the Western Region are: Donegal, Sligo, Leitrim, Roscommon, Mayo, Galway and Clare

Read the WDC Insights blog to find out more about the issues in the region here

 

2          Caring for the West

Answer: 3) 4.5%

For more on caring in the Western Region see the post here.

 

3          Disposable Incomes in the Western Region, 2015

Answer 1) Sligo

For more information on county incomes in the Western Region see this post

 

4          Creative Economy

Answer 2) 2.6 employees per firm

Read more about the creative economy in the Western Region here

 

5          Nuts about NUTS

Answer 2) 3 NUTS2 regions

Read more changes in NUTS 2 regions here

 

6          Renewable electricity in the Western Region

Answer 1) 49.5%

Read more about Renewable electricity in the Western Region here

 

7         Broadband

Answer: 2) 25%

Read more about the issue of rural broadband here, here and here

 

8      Enterprise in the Western Region

Answer: 3) 54,410

Read more about the enterprise in the Western Region here

9        Farmers in the Western Region

Answer 2)  CAP beneficiaries

See here for more information about different measures of the number of ‘farmers’.

10      The Christmas Quiz

Any or all of these answers may be correct.  Give yourself the point for just getting this far and scroll down to see what your results mean.

 

How well did you do?

You got 9 or 10 answers correct

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

 

You got between 4 and 8 answers correct

WELL DONE, a good score but some deficiencies in your knowledge. Perhaps you should read our WDC Insights posts more carefully in 2017!

 

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  J

 

Happy Christmas!

 

 

Helen McHenry

 

SMEs in Ireland: What are the issues?

Earlier this year the WDC made a submission to the Seanad Public Consultation Committee. They are currently investigating the issue of Small and Medium Sized Businesses in Ireland.  Last Tuesday we were among 15 individuals and organisations invited to address a public hearing of the Seanad on the topic.  A video of the hearings is available here (the WDC’s contribution begins at 3:48) and the final report will be published by the Seanad early next year.

The inputs to the public hearing covered the owner, national and regional perspectives on SMEs in Ireland.  Over the course of five hours a very broad range of topics and issues relevant to the operation and future of SMEs in Ireland was discussed, here are just a few of the themes which emerged.

Incentivising entrepreneurship:  How can we make it more attractive for people to choose to establish their own business?  It was suggested the idea should be encouraged at primary school level, before children enter the ‘points race’, by adding entrepreneurship to the list of potential career choices.  It was also noted that some entrepreneurship, especially in rural areas, may ‘grow from the ashes’ as a result of the closure of a large business and limited alternative employment.  Reducing personal risk as a barrier to entrepreneurship was raised in terms of social insurance, as well as the issue of the rate of capital gains tax acting as a disincentive.

Varied forms of entrepreneurship: It was proposed that more varied forms of entrepreneurship and ownership models, including co-operatives and social enterprise, should be encouraged.  With a more socially conscious generation of young people, it was recognised there could be more demand to buy from socially and environmentally conscious local businesses.  It was suggested that this could support succession planning for family-run businesses with more options for buy-outs by worker co-operatives.

Attracting skills and management capacity:  As the labour market tightens, SMEs increasingly have to compete for employees with large multinationals. SMEs can lose trained staff to FDI companies paying higher salaries and this particularly restricts the development of management capacity as SMEs find it difficult to compete with FDI companies on salaries for high level management roles.  But a strong management team is central to SME success and can also help with succession through a management buy-out.  Incentives to retain staff, such as the Keep scheme, were seen as important to tackle this.  The diaspora was also highlighted as a potential source of key skills for SMEs and a number of initiatives to attract people back to rural, regional and Gaeltacht locations were outlined. For counties in the Greater Dublin Area, promoting ‘reverse commuting’ with SMEs encouraged to establish in commuter towns to take advantage of the pool of talent currently commuting into Dublin, was highlighted.

Education and training: To meet the skill requirements of SMEs there was a need for them to identify their current and future skills needs. EI are currently running ‘spotlight on skills’ workshops for companies which aim to help with this.  Close collaboration between SMEs in a region and local education providers (ETBs, IoTs, Universities) is critical to providing the pipeline of skills needed for future jobs as well as facilitating accredited lifelong learning to upskill current staff.  Increasing the range of sectors covered by apprenticeships and making the apprenticeship path more attractive were also raised.

Costs and regulatory burden:  The rising cost of utilities and insurance and the impact this is having on SMEs.  For example a number of key insurers have left the insurance market for retail businesses in Ireland and there is uncertainty how UK insurers providing cover in Ireland will be impacted by Brexit.  Initiatives to spread costs more evenly, such as the timing of Revenue payments, could help with SME cash flow.  The Government was urged to ‘think small first’ when developing new regulations and to take into consideration the cumulative impact of numerous regulations on small businesses, rather than looking at the impact of one regulation in isolation from others.

Procurement: The potential for public procurement as a market for SMEs.  The ‘bundling’ of contracts could put some public projects out of reach of SMEs and it was felt that, as far as possible within EU tendering guidelines, SMEs should be facilitated to access public procurement

Broadband and remote working: SMEs will not be able to connect with their markets in the absence of high-speed broadband across the country.  The lack of high-speed broadband in some rural and regional locations is a critical issue and has in fact led to the relocation of some companies.  It was noted that 4G /5G mobile technology was not sufficient the needs of SMEs and fibre broadband was the most future proofed technology.  Broadband could also facilitate remote working for employees and entrepreneurs.  The provision of digital hubs and innovation centres could facilitate networking and social interaction. It was noted that there needed to be a culture change in terms of remote working.

Scale and performance:  Recent Irish economic growth has mainly been driven by FDI and Irish SMEs are not performing as well in terms of exports or innovation.  It was felt that they were not living up to their potential, as research by the Enterprise Research Centre has shown that Irish micro-enterprises have greater growth ambition, digital adoption and use of innovation than their UK or US counterparts. Growing the scale of Irish SMEs and diversifying their markets, especially beyond the UK, were seen as priorities for improved performance.  It was also noted that some SMEs may be caught in the ‘middle’, too large for LEOs but not exporting so not within EI’s remit.  Brexit makes it difficult for any SME to plan and it was suggested that some companies may need more direct support to adapt to the Brexit impact.

Investment and finance:  There is a need for more investment in SMEs, who currently largely rely on short-term debt financing rather than longer term equity investment.  Investors need to be incentivised more to make equity investments in SMEs, while SME owners should be encouraged to be more open to equity investment.  While new, high-tech companies were very open to the idea, more established SMEs may be reluctant to seek such investment.  It was also noted there was a lack of private sector early stage and venture capital funding in the regions.  In relation to lending to SMEs, a Local Public Banking model, similar to that in Germany, was proposed.  Based on relationship banking, these local public banks could provide loans to SMEs and would operate on a non-profit basis.

The ultimate outcome of the consultation will be a strategy proposal document on SMEs in Ireland which the Seanad will publish early next week and propose to the relevant Government Minister.  It is hoped this will place a renewed focus on the role and importance of indigenous SMEs to the Irish economy and regional development.

Pauline White