Intel alarmed by decline in science and engineering degree students

IDA Ireland's "antiquated" method of valuing jobs on a dollar cost-per-job basis and other outdated State policies threaten the Republic's ability to attract high-value, knowledge industry jobs, a senior executive with computer giant, Intel, has warned.

According to the company's general manager for Ireland, Mr Jim O'Hara, clumsy local regulatory processes and, more particularly, declining numbers of Irish students pursuing science and engineering degrees also could cause the company to start "rethinking its position".

Intel, which has had microchip manufacturing facilities in the State for 11 years, has invested $5 billion (€5.44 billion) in two existing chip fabrication plants and in the recently resumed construction of a third. The Leixlip company employs 3,200 people, with another 1,000 support staff.

The IDA "needed to really think hard" about its approach to inward investment, which "doesn't really position itself for intellectual jobs".

These have greater value to the economy and workforce but can cost more to bring in, he said.

The State also needed to examine its approach to higher education.

The recent drop in students choosing science and engineering as their top college choice "is particularly worrying for an industry like ours, as is the lack of postgraduate and PhD students in these areas", Mr O'Hara said.

He also noted that the State needed to offer "speed and flexibility" in its regulatory affairs. Intel had to wait 14 months to get planning permission for a small extension to one of its fabs, he said, due to sluggish local planning processes.

Mr O'Hara said that Intel needed to remain "competitive in everything we do" and regularly benchmarked its operations against other Intel facilities and semiconductor manufacturers. Part of this process was evaluating the competitive advantages of its operating locations.

The Republic had been a wise choice for the company, Mr O'Hara said. Employees of exceptional quality enabled the Irish facility to have the most productive chip manufacturing line within Intel and globally. Some 98 per cent of its wafer output is usable: "That's the best in the world," he said.

Leixlip also topped other Intel facilities in other categories. "We have a significant advantage in terms of security and stability in comparison to our Israeli operations at present," he said.

By 2006 or 2007, the new Fab 24 - a project that went to the Republic rather than Israel - will be turning out the most advanced chips Intel makes.

"Fab 24 is the right, next investment for Intel," Mr O'Hara added. The plant's construction was put on hold over a year ago when the global economy began to slide.

Mr O'Hara was speaking at a lunch at the Westin Hotel, Dublin sponsored by the American Chamber of Commerce Ireland.

See also page 4