The Challenge Facing Employers in Dublin Brendan Butler Director of Enterprise IBEC

Strengths Education Tax Regime Pro Business Government Large FDI Inflows EU Membership Social Partnership

Performance Full Employment High G.D.P / Living Standards Migration Flows Opportunities

Challenges Small Open Economy Export 90% + of everything we produce Large non-EU Trade Partners Enlargement Barriers to Free Trade

Weaknesses Cost Base Infrastructure Productivity Performance Weak R & D Performance Labour Force

Addressing our Weaknesses A. Cost Base Table 1: % Increases in Non-pay costs-Dublin Cumulative Increase Cumulative Average Inflation (CPI): % Energy Financial services Insurance Local authority rates Professional services Rents Telecommunications Transportation & Warehousing Waste Collection/Treatment Postal Communications Water Charges Total non-pay costs

Cost Base Measures Needed Competition Value for Money in Public Sector Regulation Creep

Addressing our Weaknesses B. Infrastructure Deficit Some Facts: Population Growth E.U. Funding Stock Declining Government Spend Declining

Infrastructure Deficit Measures Needed: Provide Waste Infrastructure Energy Capacity increased Transport Infrastructure Improved Project Selection Management Funding Options Planning Provisions

Addressing our Weaknesses C. Productivity and Pay Average Figures disguise real picture

Annual Competitiveness Report 2004

Addressing our Weaknesses C. Productivity and Pay 5 years ‘98-’03 – Pay per Employee grew by 37 % Ireland 9 % Germany After Inflation 12% in Ireland 4 % in Eurozone Compensation per Employee 2004 Ireland € 38,140 UK€ 35,750 EU Average€ 34,630

Addressing our Weaknesses D. R & D Performance 1.5 % of GNP spent on R & D Link between Industry and 3 rd Level Colleges Difficult to access EU supports Education trends worrying

R & D Performance Measures Needed Focus on “Applied” along with “Basic” Research Resolve the “Commercialisation” debate Links between Indigenous and Foreign owned MNCs

Addressing our Weaknesses  Labour Market Issues Incentive to work Refusal to do certain jobs Lack of clear Immigration Policy Work Life Balance Issues

Labour Market Issues Measures Needed Review CE Schemes Address Childcare / Eldercare Issue Skilled Immigration Policy

Summary 1. Restrain cost increases to business 2. Fast Track Infrastructure 3. Add greater value to the work we do 4. Encourage Innovation and Skills Development 5. Encourage increased Labour Force participation

Conclusion Ireland has become a success story Dublin has led this success Policy choices correct in the past Some clear “Warning” Signals Future is in our own hands