IDA operations set to focus on job quality, regional spread

IDA Ireland has signalled a fundamental shift in its strategy, saying it would now measure future success by job quality and regional spread, rather than numbers alone. The agency said it was "surprised" that it created 17,590 jobs last year, a record total that surpassed targets and was well above the 1998 total of 16,283.

When a higher level of job losses are factored in, however, the net increase in employment in IDA-supported industry fell slightly to 8,533, compared to 9,033 in 1998.

At the end of last year, more than 125,000 people worked in IDA-backed companies, the agency said, an increase of 7 per cent on 1998. But while the net employment in such companies rose in the east and south, it actually fell, by more than 1,200, in the Objective 1 Border, midlands and west region.

"Dublin is surging ahead because of the strong attractions it can offer international businesses. Similar growth is not yet happening elsewhere, but the IDA is committed to playing its part in a concerted national effort to achieve balanced regional growth," said Mr Sean Dorgan, the agency's chief executive.

With more than 1.5 million people at work in the Republic, employment in IDA-backed companies represents less than 9 per cent of the total. With the market alone creating so many jobs in Dublin, the IDA said it had virtually stopped all grant-aiding there.

Total employment across the economy increased by about 100,000 last year. IDA-supported industry was directly responsible for less than one-tenth of this increase, with most new jobs last year coming in the services sector in areas such as financial services, transport, communications and the retail sector. The IDA argues that increased spending in the economy by many of its client companies is a key factor behind service job increases.

But there were also increased job losses among IDA-client companies. Mr Dorgan said 1999 had brought a shakeout, mainly of lower value jobs; more than 9,000 during the year, compared to 7,250 losses in 1998.

Sales from all IDA-supported companies rose 16 per cent to £28 billion (€36 billion), while exports from these firms also climbed 16 per cent, to £26 billion, the agency said.

The strongest-growing sectors were international services, electronics and engineering, and healthcare and pharmaceuticals. Falling back were the textiles, clothing and footwear sectors, with employment diminishing by 26 per cent.

The IDA said the average cost for each job sustained over a seven-year period had dropped to its lowest level. In 1999, each job cost £10,260, compared to £11,588 in 1998, and £33,300 in 1987.

The agency said its priorities for the years ahead centred on significant industrial development in the Objective 1 region of the Border, midlands and west and upgrading the activities of existing companies to give them deeper Irish roots.

He said the IDA wanted to see firms "moving systemically up the value chain, from being basically mandated, subsidiary operations to strategically independent operations".