Irish-based staff of US multinationals more profitable than European peers

Irish-based employees of US multinationals are up to six times more profitable per head than counterparts elsewhere in Europe, a new study by PricewaterhouseCoopers has found.

The report was produced using data provided by the member companies of the American Chamber of Commerce in Ireland. It compared a range of measurements, such as profit per employee and average pay, with similar data from PwC group's Saratoga database in the US, which contains HR information collected from large companies around the world.

It found that the profit per full-time employee for the multinationals in Ireland was, on average, €23,588. Elsewhere in Europe, the comparative figure ranged between €4,021 and €9,514. In the US, it was €27,474.

The report also found that, for every euro invested by the Irish-based companies in staff pay, they received a return of €1.36. This compared with €1.34 in the US and between €1.11 and €1.57 in Europe. Central and eastern Europe is more profitable per head for multinationals than western Europe, according to the Saratoga data.

Average remuneration at the Irish-based companies was €52,423, higher than the rest of Europe, but lower than the US. Average pay is €70,321 in the US, €35,532 in western Europe, and €16,164 in central and eastern Europe.

Absenteeism at the Irish units is half that of the rest of Europe, according to the study, which found absentee rates of 2 per cent here compared with between 4 per cent and 4.3 per cent on the continent.

Staff turnover rates were also lower here at 6.9 per cent, compared with 12.2 per cent in the US and up to 16.7 per cent in Europe.

Ciara Fallon, PwC Ireland's director of people and change, said many companies struggle to properly analyse human resources data. "Organisations that get it right enjoy a better return on their people investment and are better equipped to take advantage of business opportunities," she argued.