IDA Ireland End of Year Statement 2011

Strong Performance in new job creation from multinational companies in 2011. Export led growth creates over 13,000 new FDI jobs

Investment Highlights

• Over 13,000 new jobs created, up 20% on 2010
• A record total of 148 investments won, up 17% on the previous year
• 61 new companies investing in Ireland for the first time, up 30% on 2010
• €115 billion (over 70%) of Irish exports from IDA client companies
• C. €700 million in new R&D investment
• Over 70% of corporation tax in Ireland paid by IDA client companies ,
• IDA client companies spend €19 billion in the Irish economy
• IDA client companies paid €6.9 billion in payroll
• Two-thirds of business -spend on research & development is by IDA client companies.

Of the 148 FDI investments made in 2011, a record number of 61 were from multinational companies investing in Ireland for the first time while 87 were made by existing client companies. Of existing client investments, 46 were expansions while 41 were in research and development.

FDI employment opportunities relevance in CAO selection

• Employment opportunities continue to grow in key skill areas – implications for those deciding on career and study options.

IDA has identified current and future industry trends which point to strong career opportunities in areas such as technology, business services, science, engineering, financial services, languages and manufacturing/supply chain. It is vital for those making an education or career choice, or wishing to up-skill, to focus on where current and future job opportunities exist and the key skills required by investors / employers.

A recent skills’ demand survey conducted by IDA highlights that almost half of all new FDI jobs created in 2011 (47%) require ICT, science and engineering (technology) skills – such as computer programmers, software development professionals, IT user support technicians with languages, engineering, quality control and research and development specialists; 19% require business, finance and accounting skills – including accountants, financial traders, finance and investment analysts; 14% require manufacturing, distribution and logistics skills – i.e. process operatives, transport and distribution executives and 12% require skills in sales and marketing – business development executives and marketing professionals, of which two thirds require multilingual personnel.

Ireland’s academic institutions provide a wide variety of courses which qualify graduates to meet industry needs to match with employment opportunities. These include technology programmes in computer science, software engineering and computer applications and support. Universities and Institutes of Technology in Ireland offer, for example, computer science courses with a foreign language, accounting, finance and international business courses with languages, supply chain/logistics programmes, science qualifications and chemical, electronic and mechanical engineering degree courses. 

Export led economic recovery leading to FDI jobs

The FDI sector has delivered over 13,000 new jobs through its strong export performance. Export led growth is an essential component to Ireland’s economic recovery. IDA client companies account for €115 billion or over 70% of Irish exports. The growth and development of multinationals and their focus on high value goods and services exports is fundamental to the Irish economy and is playing a vital part in Ireland’s export led economic recovery.

FDI impact on economy

The importance of FDI to the Irish economy remains highly significant. In addition to exports, FDI accounts for a total of 250,000 jobs (1 in every 7 jobs) in the Irish economy and €19 billion spend on Irish sourced goods and services including €6.9 billion in payroll. Companies who have chosen Ireland as the location for their FDI operations include 9 of the top 10 global pharmaceutical companies, 8 of the top 10 US ICT companies, 17 of the top 25 medical device companies, more than 50% of the world’s leading financial services firms, the top 10 ‘born on the internet’ companies and 3 of the world’s top 5 games companies.

Existing Clients and their Transformation

Multinational companies are increasingly under cost pressure globally.  It is common practice for companies to achieve 5-10% productivity growth year on year or have a policy of constantly relocating a certain proportion of current activities to lower cost locations.  As a result, there is a continuous requirement for Irish FDI operations to improve competitiveness and transform.

In keeping with IDA’s focus to support transformation within our client companies it has been encouraging to see that a large number of existing clients announced expansion and diversification investments in 2011. These involved skills uplift, technology uplift, RD&I (research, development and innovation) in product and process improvements, and energy initiatives or taking on new mandates in order to increase their Irish operations’ strategic importance within their parent corporations.

Companies that announced expansion and diversification investments in 2011 included Intel, PayPal, HP, Boston Scientific, VMware, Pfizer, D&B and Fidelity.

IDA’s strategy includes winning as many new jobs as possible each year and giving equal priority to maintaining existing jobs. We recognise that job losses occur every year for a variety of reasons including changing competitiveness, competition from sister sites, product and technology lifecycles or global location rationalisation as a result of mergers and acquisitions.  In 2011, there were 6,950 jobs lost, the lowest level in over a decade and significantly down on the previous year’s level of 9,635. With over 13,000 new jobs created and a much reduced level of job losses IDA’s employment portfolio increased by 6,114 jobs.  

Manufacturing

The manufacturing sector remains as a core pillar of FDI investment in Ireland.  Our strong reputation in manufacturing is primarily due to quality, productivity and competitiveness for companies.

In the last 12 months many manufacturing companies have made investments in Ireland in manufacturing activities. Intel is investing $500 million in the upgrade of its manufacturing facility in Co. Kildare with the creation of 200 new high-value manufacturing jobs and 850 construction jobs and Coca-Cola opened its $300 million new manufacturing and innovation facility in Wexford which will create 100 new jobs. Meanwhile, leading technology manufacturer, Valeo, announced a 100 person, €17 million expansion at its Tuam, Co. Galway facility which opened in August.

Bausch and Lomb deepened its commitment to the South East with a $100 million investment in its eye care manufacturing operation in Waterford. This investment resulted in the creation of 100 construction jobs and helped secure the existing 1,100 jobs in place at the company. AMS invested €4.6 million and plans to create 50 jobs with the establishment of a manufacturing facility in Athlone; medical device supplier Kelcourt announced the establishment of a manufacturing operation in Tullamore with the creation of 55 new jobs; medical devices manufacturer Harmac invested in a 10,000 square foot expansion at its Co. Roscommon facility with plans to create 100 jobs, while Carefusion, announced a 35 job expansion at its manufacturing centre of excellence in Gort, Co. Galway.  Sangart announced plans for a new manufacturing facility in Cork to include the creation of 120 manufacturing jobs and 125 construction jobs and Biomarin announced its acquisition of Pfizer’s manufacturing facility in Shanbally, Co. Cork with plans to create 100 new high quality jobs. Amgen, the world’s number one biotechnology company, also announced the acquisition of Pfizer’s manufacturing facility in Co. Dublin with the retention of 280 jobs.

Services

There has been a significant increase from overseas companies in services based activity which is contributing strongly to the delivery of jobs. 

Ireland is one of Europe’s leading locations for Business Service companies with a strong track record of attracting international shared service operations and regional headquarters to serve European and global markets. Investments from companies engaging in services activities included PayPal, Quest Software, LinkedIn and Coca Cola.

Research, Development & Innovation (RD&I)

Over €700 million in new RD&I investments were won for Ireland in 2011. RD&I remains significantly important to Ireland’s FDI landscape embedding existing employment and putting in place the framework for future employment creation. Amongst the companies that announced RD&I investments in 2011 were Boston Scientific, IBM, Valeo, EMC, Analog, MSD, Biotrin and Covidien.

Ireland’s technology centre programme is a vital part of our attractiveness as a location for RD&I investment. Thirty key IDA clients are participating in the nine established centres reflecting their importance to our clients. 

Regions

In 2011 there were many companies making significant investments in regional locations such as Valeo, (€17 million expansion, Tuam, Co. Galway) AMS  (€4.6 million investment and 50 jobs, Athlone, Co. Westmeath) Kelcourt (55 jobs, Tullamore, Co. Offaly)  Zenimax  (hundreds of jobs, Galway)  Avaya (50 jobs, Galway) Bausch and Lomb ($100 million investment, Waterford) Gilt Groupe (200 jobs, Limerick and Dublin) NPD (100 jobs,  Athlone, Co. Westmeath) Harmac (100 jobs, Castlerea, Co. Roscommon) Mycroft (50 jobs, Waterford) Teleflex (80 jobs, Limerick) Ericsson  (100 jobs, Athlone, Co. Westmeath) Analog (100 jobs, Limerick)  EA and Bioware (200 jobs, Galway) JRI America (Sumitomo) (100 jobs, Tralee, Kerry) Pivot (100 jobs, Galway) Prometric (100 jobs, Dundalk, Co. Louth) and ON Semiconductor (69 jobs, €13m investment, Limerick). 

In addition, a number of companies officially opened strategically important facilities in regional locations such as Boston Scientific (€26m investment, Tipperary), Coca Cola (100 jobs, $300m investment, Wexford), MSD (€100m investment, Tipperary) and Genzyme (€150m investment, Waterford).

Collaboration/ Team Ireland/Infrastructure

While IDA is responsible for securing FDI for Ireland, the Agency greatly appreciates the collaborative approach undertaken by all key stakeholders, to ensure ‘Brand Ireland’ is marketed to our target global audience and that investor requirements are met.

Strong working relationships exist between IDA Ireland and its sister enterprise agencies. In addition, IDA also works closely with a range of public and private sector organizations to promote Ireland as a location for FDI including, for example, IFSC Ireland and the Irish Funds Industry Association whom we collaborated with in the past year. IDA has partnered with the IFIA in the opening of a number of representative offices in the US, the UK and Asia. Significant ‘Team Ireland’ events in 2011 included our involvement in the recent Founders event, which brought many of the leaders in the global technology sector to Ireland.

The provision of additional national and international connectivity for electricity and telecoms is a key enabler to supporting the FDI agenda. Ireland’s infrastructure continues to be enhanced through State investments in electricity grid investments by ESB, and Eirgrid through its Grid25 strategy, and telecoms investments by Aurora and ESB Telecoms.  

Competitiveness / Ireland’s share of FDI

On a global scale, Ireland scores extremely well in many of the key areas of importance to investors, helping drive FDI. The IMD World Competiveness Yearbook 2011 ranks Ireland 1st in the world for corporate taxes, 1st for business legislation for foreign investors and 1st for the availability of skilled labour. The same report also ranks Ireland 2nd in the world for consumer price inflation, 3rd for direct investment flows inward, 3rd for availability of finance skills, 4th in the world for labour productivity, and 4th for exports of commercial services.

The 2011 IBM Global Location Trends Report highlights that Ireland is ranked 1st in the world for inward investment by quality and value and 2nd globally for the number of inward investment jobs per capita. The World Bank Doing Business Report 2011 ranks Ireland 1st in the Eurozone for ease of doing business.

Ireland is ranked 2nd most attractive country globally for Foreign Direct Investment by the NIB/FDI Intelligence Inward Investment Performance Monitor 2011 while the Ernst and Young Globalisation Index ranks Ireland as the 2nd most globalised economy in the world. Indeed, Ireland’s most profitable natural resource is its people and their expertise. Ireland’s value proposition built around the talent and capacity of Irish people has proven to be highly profitable and a very positive solution for the large number of international organisations who have invested here. 

Pipeline Momentum/ FDI Outlook

Undoubtedly, the global economy and in particular the European economy, which is the primary target market for FDI clients in Ireland, is in a low growth phase. The challenge for IDA is to win FDI in this low growth environment.

The immediate pipeline is encouraging, however at any one time IDA needs a minimum of over 100 potential investments in play to achieve its targets.  IDA’s business activities are focused on generating sufficient numbers of business leads to ensure this pipeline level is achieved and maintained throughout 2012.

The immediate outlook for Ireland’s foreign direct investment portfolio is positive with a strong short term pipeline in place. The current profile of investments in the pipeline will lead to an increase in construction activity. IDA Ireland is confident of securing further investments particularly in life-sciences which will include a number of capital intensive investments involving significant construction projects. The pipeline from the ICT, International Financial Services, Digital Media and Business Services sectors is also strong in the short term.

Notes to Editors

NOTE: *Corporation Tax data refers to year 2010.

Barry O’Leary, IDA Ireland CEO available for interviews

Contact:

IDA Ireland, Communications, Tel: + 353 1 603 4226 / +353 1 603 4000.

Thomas McEvoy, Media and PR Manager, Tel: +353 1 603 4255.

Antoinette Tyrrell, Media Executive, Tel: +353 1 603 4256 / Mob: +353 87 757 2053.

ENDS