State’s 90,000 IT workers best paid, most educated and productive

CSO report provides profile of Republic’s muscular information technology sector

The State’s 90,000 IT workers are the most educated, the most productive and the best paid in the workforce, according to a new report. However, fewer than one-third are women and women accounted for just 5 per cent of telecommunications engineers.

An in-depth review of the Information and Communications Technology (ICT) sector by the Central Statistics Office (CSO) shows it employed 90,766 people in 2019. While large foreign multinationals such as Google and Facebook dominate the ICT job market, domestic companies employed almost half (40,746) of the total numbers working in the sector.

ICT workers were found to be the best paid of any category of employees, earning on average €64,345 per annum.

Wages

The industry also generated more wages paid in Irish households than labour intensive areas such as hospitality or construction, receiving €8.5 billion in wages in 2019, of which €2 billion was from domestic firms.

The relatively high wage levels may be explained by the fact that it is also “a very productive sector”, the CSO said, noting that the value added per hour worked was “exceptionally high”. The gross value added (GVA) per employee per annum – roughly speaking the value of an ICT worker’s annual output – was €567,089.

However, the report detected a large disparity in productivity levels between large multinationals and smaller entities in the sector. The GVA per employee per annum in large enterprises was €704,193 but it was just €71,472 in medium-sized firms and €53,602 in small ones.

The report also detected a high level of churn within the ICT workforce, with nearly 9,000 workers (10 per cent of the total) changing jobs in 2019 but remaining in the ICT sector. This was evidence of “knowledge sharing and/or spill-overs of expertise” between large multinationals and domestic firms, the CSO said.

On gender equality, the sector scored less well with women accounting for just 32 per cent of the workforce and a fraction of telecommunications engineers (5 per cent).

The ICT sector was also found to have highly educated workforce: almost two-thirds had a college degree or higher.

Assets

The CSO’s analysis also showed that most of the ICT output generated in the Republic is exported, In 2019, it exported €117 billion (91 per cent) of the total output of €128 billion. Total investment in the ICT sector at the end of 2019 was €103 billion, which equated to 10 per cent of all capital assets in Republic.

"Looking at the contribution to gross domestic product (GDP) by firms in this ICT value chain analysis, released today, the dominance of foreign owned multinational corporations is evident," the CSO's Michael Connolly said. "The same story emerges from a review of capital investment in the sector, where Intellectual Property assets owned by these multinationals also predominates," he said.

“ But critically, when we consider the human capital contribution in the value chain, we see that almost half of the highly educated workforce are employed by Irish firms,” he said.

Eoin Burke-Kennedy

Eoin Burke-Kennedy

Eoin Burke-Kennedy is Economics Correspondent of The Irish Times

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