FDI jobs hit record levels

2022 has seen strong growth in employment created by foreign companies in Ireland, with a rise of 9 per cent. There were 32,426 new jobs in Ireland in 2022 in total.

Some of the key announcements for 2022 in Cork included significant expansions for Apple, Dell, Janssen, Merck and Stryker. IDA Ireland has also acquired new landbanks for future development in Ireland including in Cork.

This week IDA Ireland has reported a substantial increase in growth in FDI (foreign direct investment) employment on 2021.

Total employment in IDA client companies in Ireland now stands at 301,4751, a 9% increase on 2021, while 103 of the 242 investments won in 2022 were new name investments.

Job losses remained at historically low levels with 8,407 recorded in the past year giving a net jobs total of 24,019 for 2022.

Total employment in IDA client companies in core sectors grew in 2022, up 9% to 116,192 in information and communications services, up 8% 105,199 in modern manufacturing, 5.6% in traditional manufacturing to 23,658 and up 9% to 56,426 in business, financial and other services.

The strong growth in regions continued this year with 127 - or 52% of the investments won going to regional locations and employment growth recorded in every region.

Employment growth was highest in the Mid East region; up 13.1% to 21,861. Dublin was up 10.5% to 137,822 while the South West was up 7.5% to 52,228.

According to the IDA, it is evident that the global economy faces serious headwinds in 2023 with the continuing Russia-Ukraine war, inflation, monetary policy and geo-political developments.

IDA continues to monitor the situation in the global technology sector and continues to actively engage with its technology client base, describing recent tech job losses as “regrettable”.

They say the tech base in Ireland has been building for over 60 years and will continue to grow in the future, despite current challenges.

Reaction

An Tánaiste & Minister for Enterprise, Trade & Employment Leo Varadkar said: “Ireland has not been immune to the challenges created by global events of recent months, and we expect those to continue into 2023. However, these figures show that Ireland continues to be seen as a location of choice for new investors and long-established companies who chose to reinvest in substantial expansions of their operations here.

“These are the best ever FDI employment figures in a single year – 24,019 net new jobs represent a 43% increase on 2021, which itself was a record year. The numbers directly employed in the multinational sector have also surpassed the 300,000 mark for the first time.”

He added: “While I am concerned about the job losses in tech, there is a good pipeline of new investments coming from the multinationals and Irish-owned corporations in a range of sectors including life sciences, food and beverages, manufacturing and aviation. We expect many positive announcements in the coming months.

“Last week I launched a new White Paper on Enterprise which sets out the Government’s enterprise policies in the period to 2030. FDI will remain central to our economic model. The White Paper seeks to advance Ireland’s FDI and trade value proposition and includes the targets of a 20% increase in IDA client expenditure in Ireland by 2024; and at least half of all FDI investments between 2021 and 2024 to be located outside of Dublin.”

Mary Buckley, Interim CEO IDA Ireland said: “The challenging and volatile international environment that we saw in 2021 escalated this year. In light of that, these annual results are most encouraging and show that investors’ commitment to Ireland remains strong and Ireland’s value proposition as a place to do business remains a compelling one.”

She added that severe headwinds facing the global economy in 2023 means the IDA will have to work harder than ever in the year ahead to win new investment. In the face of such uncertainty, she said that it is likely to see companies adopt a cautious approach, and so slower growth is likely in 2023.

“We continue to see opportunities across and within our sectors of focus, which we believe remain well aligned to the global economy of today and well positioned to succeed in the transformed economy of the future. At the same time, we will continue to seek out and exploit opportunities in new and emerging growth areas in an evolving investment landscape.”

Outlook

The soon-to-be-released ABSEI2 survey will show that expenditure within the economy by FDI companies increased during 2021 despite the prevailing challenging conditions. Payroll was up 9.8% to €19.6bn, Irish services and materials spend increased by 10% to €11.1bn and capital expenditure was up 8% to €9.2bn. Exports of €315.5bn represented an increase of 8.7% year on year. This resilience and growth from FDI has been an important contributor to our economy and the national finances.

The altered political and economic landscape and its immediate future implications for FDI is a key focus of IDA’s current mid-term review of its strategy (Driving Recovery & Sustainable Growth – 2021-2024). The review is considering FDI implications arising from the global trends including the rise of industrial policy, open strategic autonomy, global tax reform, the future of work, the sustainability imperative and the increased prominence of geopolitics as a factor in the economic outlook.

Mary Buckley said: “We have experienced much change in recent years from the national recession from 2008 to the global pandemic, and considerable global economic and political upheaval. Responding proactively to change has been the hallmark of Ireland and IDA’s success and we will continue to be agile, resourceful and committed in our aim to continue to attract FDI to Ireland.

“To remain successful in the years ahead we need to accelerate the carrying capacity of the economy with regard to housing, energy, water, planning, infrastructure and also with talent policies. Continued action at speed and scale to address these issues is essential if we are to successfully move to an internationally competitive low carbon, high tech economy.

“Client companies remain positive about the business environment in Ireland and our attractiveness relative to key competitor locations for FDI. This is borne out by a good pipeline of investments for H1 2023. Ireland’s strengths continue to include our skilled and diverse talent base, high quality education and training ecosystem, stable and consistent policymaking, and competitive corporate tax regime,” she added.