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Ireland remains an attractive investment destination for US companies

Economy expected to rebound strongly in the second half of 2021 as Covid restrictions are eased

If the vaccine roll-out is a success and the pandemic’s impact lessens, then the second half of 2021 will see very rapid economic growth and a very broad church of sectors in hiring mode, says Neil Gibson, chief economist, EY

If the vaccine roll-out is a success and the pandemic’s impact lessens, then the second half of 2021 will see very rapid economic growth and a very broad church of sectors in hiring mode, says Neil Gibson, chief economist, EY

 

Over the course of the pandemic in Ireland, close to 5,000 people lost their lives and the lasting impact to businesses and the economy will be felt for years.

However American companies continued to expand and develop their workforces here and encouragement can be found in the level of job creation being seen in parts of the economy.


An impression of Salesforce Tower to the left of the Central Bank’s docklands headquarters in Dublin

The Ireland-US Business special report looks at how American companies continue to expand and develop their workforces here, and how encouragement can be found in the level of job creation being seen in parts of the economy. 

Check it out in full in the Friday's print edition of The Irish Times, via The Irish Times ePaper, or via The Irish Times special reports digital hub.


In EY’s recent report on foreign direct investment in Ireland, the country ranked 9th out of 48 countries in Europe for FDI, and stated that the US continues to be the most active investor country into Ireland accounting for 58 per cent of projects.

This evidence suggests that a very rapid bounce back is likely across elements of the retail, accommodation and entertainment sectors, according to Neil Gibson EY chief economist.

“Though later in 2021 there will be the unusual incidence of a fast-growing economy occurring against a backdrop of rising unemployment as supports are removed,” he says.

“Looking at investment into Ireland as a driver of job creation, recent research carried out by EY amongst over 550 global investors, found that there remains long-term optimism in western Europe in particular as an investment destination – presenting a significant opportunity for Ireland to position itself as a location of choice for businesses and thus fuelling greater jobs growth.

“The vast majority of investors in our survey (80 per cent ) said western Europe will be the most attractive global location for FDI post Covid-19, while 40% said they were planning to establish or expand operations in Europe in the next 12 months.

“Ireland’s credentials as a country with a highly-skilled, English-speaking, European workforce with a high quality of life will serve us well in tapping into this optimism,” he says.

The pandemic and, to a lesser extent, Brexit has shone a light on many of Ireland’s areas of expertise and the ICT, technology, pharma and life sciences sectors, all of which have high levels of US investment, have continued to perform strongly and hire more staff.

“The combination of access to EU markets, talent pool and track record of support and success continues to drive more investment and job creation throughout Ireland. The pandemic highlighted the value of innovation and of science and research and increasingly, US investors into Ireland have been expanding their R&D footprint which offers encouragement for future job growth,” Gibson says.

Significant transactions

Conor O’Sullivan, partner and life sciences lead, KPMG echoes that point.

“Ireland has become a global hub for pharma, pharma-services and medtech and the life sciences sector brings to Ireland a significant degree of economic buoyancy. There is plenty of opportunity for young educated talent and the sector is attracted to Ireland for that talent pool.

“Many of our clients continue to expand and put their faith in Ireland and we expect this to remain the case – as evidenced by the growth of clusters of expertise and the very significant transactions that have taken place,” he says.

Meanwhile, Facebook has featured prominently in the media in recent weeks with respect to its announcement of a potential for remote working from abroad, with some commentators stating this to be a portent of an exodus of tech companies from Ireland, Jeff Green, partner - Employment & Benefits Department at William Fry says.

“However Facebook’s country head Gareth Lambe confirmed that hiring is continuing in Dublin and the remote working announcement won’t materially affect employment numbers in Ireland, and a look at the Jobs Board on the American Chamber of Commerce Ireland supports this and shows that the “usual” household names continue to recruit in big numbers in Ireland: Facebook, Intel, LinkedIn, Microsoft, Paypal and more,” he says.

With regards to remote working, even if the move towards that sees some companies reducing workforce numbers in Ireland, Green says one need only look back to the Dell closure in Limerick in 2009.

There was “extreme consternation and dire predictions by commentators for Ireland at that time; fast forward even just a few years and Ireland’s resilience was evident and its attractiveness to US companies remains unabated. I believe that rather than an exodus of such workers out of Ireland, what is more likely is a move of some workers out of Dublin and into the regions where the cost of housing is more reasonable”, he says.

Large companies currently recruiting include Abbott, Abbvie, Jazz Pharmaceuticals, Amgen, Bristol Meyers Squibb, Allergan while Salesforce plans to create 1,500 jobs between 2019 and 2025 to operate out of its new campus in Dublin. Mastercard are planning to create 1,500 jobs with a new Leopardstown campus.

“It is not just Dublin that is benefiting; Varonis Systems, a data security and analytics company plans 60 jobs in Cork; A-LIGN (cybersecurity and compliance firm) plans 40 jobs in Galway; Electronic Arts (video game publisher) is recruiting for its Galway offices, and many of the pharma companies mentioned are of course based outside Dublin” he says.

Work remotely

The ability of workers, especially in the tech industry, to work remotely is likely to see further recruitment outside of Dublin for jobs that previously would have been advertised as “Dublin”.

If the vaccine roll-out is a success and the pandemic’s impact lessens, then the second half of 2021 will see very rapid economic growth and a very broad church of sectors in hiring mode, Gibson says.

“The badly impacted retail, leisure and tourist sectors should be back at the recruiting table and the public sector should also be expanding to meet increased demands.

“However it is important not to be too categoric in classifying where growth might be. Looking at EY’s Entrepreneur of the Year programme there is strong evidence that there is really no such thing as a twilight or dying industry, there are good ideas and great businesses in every sector and every county in Ireland.

“Within sectors, new roles are emerging and lines blurring between traditional job descriptions. It is all about skills, competencies and talent, far less about sectoral classification or outdated concepts of what a particular business or sector does,” he says.