Ms Bríd O'Brien:

I thank the committee for the invitation to speak this morning.

I will start by noting the changing context in which we operate. Thankfully, employment is rising and unemployment is falling. However, there remains a very considerable challenge to be addressed, even with these figures moving in the correct direction.

A striking aspect of the most recent figures, from the quarterly national household survey for the first quarter of this year, is the regional spread of unemployment. The unemployment rate ranges from 5% in the mid-east to 9.3% in the south east. It dropped across all the regions but that regional spread is quite striking, in particular when there is a target within the programme for Government to prioritise regional development and aim for an unemployment rate in each region that is within 1% of the overall national average. That, in itself, highlights some of the challenges the State faces, even with the employment and unemployment figures moving in the correct direction. This is an issue that Brexit will exacerbate.

It is important to note that these headline figures do not necessarily capture realities of the structural unemployment and labour market inequalities that face people living in disadvantaged areas, both urban and rural, and people facing discrimination because of their age, ethnicity or class, or because they have a disability or are parenting alone, or because of the implications of their long-term unemployment. A striking feature of research the CSO conducted a number of years ago on equality in Irish society was that the category with the second highest rate of discrimination discovered was the unemployed. That was captured because the CSO, in the quarterly national household survey, captures people's principal economic status. Those are issues that need to be named and addressed. They should be named and addressed anyway but with Brexit and its implications, they certainly need to be named now.

At national level, employment increased by 68,600 over the past year. It increased in seven of the eight regions; it dropped slightly in the Border region. Something we were struck by in the document the Government published in May, "Ireland and the negotiations on the UK's withdrawal from the European Union, The Government's Approach", is that it highlighted analysis undertaken by the Department of Finance that "the economic sectors most impacted by Brexit generally comprise indigenous enterprises that are small in scale, are significantly dependent on the UK as an export market, have deep links with the rest of the economy, have high levels of regional and rural employment (including around the border), and have relatively low profitability." These are challenges that are already face us and, depending on the nature of the Brexit, could very much be exacerbated.

The document goes on to note, "Brexit poses significant challenges to the development of Irish owned industry and in particular to the regions which can be dependent on small, medium and large Irish businesses for job creation". It goes on to note that although reliance on the UK as an export market has declined over the past ten years, it "is and will remain the most important export market for the development of [Enterprise Ireland] client companies". Moreover, it is strategically important for first-time Irish exporters and for many small and medium-sized enterprises, and clearly for certain large companies here the primary export market of which is the UK.

It is important to look back at the employment and unemployment figures over the past five and ten years because, even though these figures are currently moving in the right direction, having that backward view highlights the remaining challenges. In terms of employment, we now have more than 2 million people employed, as compared with five years ago when the number employed was 1.8 million, but that is still lower than ten years ago, when it was 2.1 million. Likewise, unemployment has dropped dramatically when compared with five years ago when more than 321,000 people were unemployed but it is still 50% higher than it was ten years ago. Looking at long-term unemployment, thankfully, that has also dropped in comparison with five years ago, but it is two and a half times the level of ten years ago.

A figure we find useful to look at is what the Central Statistics Office calls the potential supply of labour. It helps to capture those who do not answer "yes" to the two questions to which one must answer "Yes" to be captured as officially unemployed, which are, "Were you looking for work in the past four weeks?", and "Are you available to take up work in the next two weeks?" If, for whatever reason, one has lost heart and stopped looking, or if one has care or transport issues and believes it will take more than two weeks to sort them out, one might answer "No" to one or other of those questions. The most recent rate of potential labour supply - we use the third definition here because it is the one that is consistent over the past ten years - is 9.5%. It captures those who answered "No" to one or other of those questions or those who are working part time but do not wish to - those who are underemployed. It is a figure that captures the employment challenge that remains and continues to face Ireland.

In my submission, I cite a number of quotes in the paper from the ESRI capturing the impact of what Brexit could do to the Irish economy, in particular, to sectors that are particularly important to Irish indigenous industry and those seeking work. At the end of the first quote, the ESRI highlights that "Approximately 30 per cent of all employment is in sectors that are heavily related to UK exports – particularly SMEs in the agri-food and tourism sectors – and are likely to feel the brunt of any negative shocks to trade." The ESRI also notes, earlier in the quote, "The negative shock to foreign demand is expected to flow through the economy by means of lower exports, which has implications for the labour market and employment."

In the scoping paper published a year and a half ago, the ESRI captured the reality for many that when work is not available here, the first port of call when seeking work is the UK. Both the nature of the Brexit that emerges and the nature of the Border that emerges have significant implications in that regard.

I welcome that the Government, in its May document, notes the commitment by both the Irish and British Governments to maintain the common travel area, as well as the support from the European Union around these issues.

There is still a long way to go in negotiations before we find the reality on the far side.

At some of our recent regional forums to discuss the impact of Brexit, people noted the importance of being able to commute between Ireland and the UK. That includes those who live and work on either side of the Border on this island. People also noted that those who live in rural and urban areas commute to Britain on a Monday-to-Friday basis to work and highlighted the difficulties Brexit could cause in this regard. People also noted, from a personal and family perspective, how individuals access health and education services and the implications of Brexit for that. Many people living in the Border area feel that the Border is no different between their counties and the other counties in Ulster than the borders between Dublin and Meath or Cork and Kerry. There is a potential impact on people trying to go about their daily business.

Our most recent conference called on the Government to plan for the employment and unemployment impacts of Brexit and, in particular, to identify the emerging and possible job losses, the potential alternative enterprises and jobs, and the education and training supports that are required to ensure unemployed people can gain access to these jobs, which must be decent and sustainable. We feel the latter is particularly important if people are to be able to move from welfare into work and be able to establish their own economic independence with its accompanying social benefits.

In May, the EU published the country-specific recommendations. The second part of the second recommendation calls on Ireland to "Enhance social infrastructure, including social housing and quality child care; deliver an integrated package of activation policies to increase employment prospects of low-skilled people and to address low work intensity of households." These are the very people we would be concerned about. They often come from families and communities where there is experience of structural unemployment or inequalities in the labour market. They are often people whose only access to the labour market arises from activation programmes or precarious employment. We would be concerned that Brexit could exacerbate that dynamic for people and leave many in a continuing precarious position.

At present, Ireland's national employment service focuses primarily on people who are in receipt of a jobseeker's payment, be that benefit, allowance or the transition payment. The service is overseen by the Department of Social Protection and contains the following elements: Intreo, with a strong focus on the shorter-term unemployed; the local employment service, with a strong focus on longer-term unemployed and referrals from Intreo; Intreo also refers people who are unemployed to jobs clubs and the social inclusion community activation programme; and JobPath with a strong focus on longer-term unemployed who receive referrals from the Department of Social Protection.

The main policy underpinning these services is Pathways to Work 2016-2020, which was published before the decision in the UK referendum to withdraw from the European Union. It refers to changing from activation in a time of recession to activation for a time of recovery. Its two main objectives are: to continue and consolidate the progress made to date with an initial focus on working with unemployed people, particularly those who are long-term unemployed; and to extend the approach of labour market activation to others who, although not classified as unemployed jobseekers, have the potential and the desire to play an active role in the labour market. Brexit will throw up challenges to those two objectives. In order to achieve the latter and to ensure good outcomes for the long-term unemployed, it will also be important to ensure that active inclusion in principle and practice is an integral part of how this policy is implemented.

The latter part of those objectives feeds back into the EU Commission's country-specific recommendation and the need to ensure that this recovery strives to be truly inclusive. However, to do this demands a level of integration across relevant Departments and their agencies that is not in evidence at the required level of consistency that is essential if we are to see the country-specific recommendations and that objective met as they ought to be.

It will also be critical to ensure that activation programmes act as a real stepping stone - as described on the Department's website - for unemployed people and others of working age into a decent job, including self-employment, or further education and training opportunities if required. I have included a table for the members' information to show how participation on programmes has changed over the past five and ten years. The number availing of the back-to-work enterprise allowance is considerably higher than ten years ago and down slightly on where it was five years ago. Tús did not exist ten years ago and now has more than 7,000 people participating. The JobBridge internship measure was introduced in response to the crisis and has since been closed, with the figures dropping quite dramatically. Participation on community employment which is an important support for many communities trying to manage disadvantage and economic and social exclusion has stayed at approximately 2,000. Gateway was slow to get off the ground, had a short burst of activity and now the numbers are falling dramatically. They reached a high of 2,500 approximately two years ago. The numbers on full-time training, which was under the remit of FÁS and is now under the remit of education training boards, have continued to fall, which is of concern to us because in the past they were interventions with good employment outcomes. The identified skills gap between the experience unemployed people have and the experience and skills required for the jobs available is an issue of concern for us. At present, in the region of 67,000 people are on activation programmes. For many, these are a critical first step into the wider labour market. However, a great deal of work needs to be done to ensure that people can then progress to better employment in the wider labour market.

To address the impact and implications of Brexit, it is critical that an integrated, interdepartmental and inter-agency approach is developed to ensure that the maximum possible number of unemployed people gain access to employment and to work with those in danger of losing their jobs. This will require a mapping exercise that identifies the emerging and potential job losses, and that looks at the alternatives and supports required to ensure people are able to access this work.

A recent report from the expert group on future skills needs on the food and drink sector highlights the importance of good inter-policy and agency co-operation. The report noted that:

The Food and Drink sector has expanded significantly over the period and increased exports by more than 50 per cent; employment in Enterprise Ireland, IDA Ireland and Udaras supported firms has increased by almost 6,600 (+13%) since 2009 to reach 54,000 in 2016. This recovery in employment and expansion of output has been in the context of significant change in the food and drink sector generally with an increased focus on sustainability and traceability of origin and increased integration of ICTs, regulatory requirements and of science-based product innovation and a diversification of markets for Irish exports. The impact of Brexit will further accelerate the impact of a number of these drivers of growth, in particular in relation to market diversification. The sector relies on skills supply from both the domestic education and training system and also from a continued flow from outside the country. This is particularly the case at operative and production occupation levels.

The critical one for us is the reliance on the skills supply from both the domestic education and training system.

To ensure that unemployed people and others of working age who are more distant from the labour market are properly supported to address the challenges of Brexit, a systematic approach is critical. As one affiliate noted, it is likely that the individuals benefiting less from the economic upturn will also be impacted disproportionately by any negative fallout from Brexit. As a result of the fact that such individuals tend to live in specific communities, those communities should receive specific supports to assist them deal with the impact of Brexit.

That systematic approach must include: early engagement with companies that make job announcements with a view to gathering information on the nature of the positions to be filled; clarification of the skills, experience and competencies required to successfully do the jobs; and details of the recruitment process to be used for filling these positions. This, in turn, should inform the work of the local employment services and education and training provision to unemployed people and others of working age to avail of those opportunities. A quote from the Action Plan for Education captures the importance of people being able to access good education and training services and supports, both the impact on them personally and also on their personal goals in life, which for people who are unemployed means gaining access to a good job.

At our annual delegate conference there was a call on the Government to resource the provision of good career and employment guidance to support unemployed people to make informed choices, access appropriate education and training, leading to good quality employment in terms of job security and salary levels and in particular to ensure this is available to individuals and communities most disadvantaged in the labour market.

The onset of Brexit demands well-resourced action on this front. The provision of person-centred services that focus on supporting unemployed people to assess their learning needs and the necessary opportunities to improve their employment prospects must be an integral part of such action. This involves providing good-quality information and guidance, improving integration and transition between employment services and education and training supports, working proactively to get the referrals and the matching piece correct - this is absolutely critical - and ensuring all programmes are open to unemployed people. The appropriate resources must be provided to ensure that people who have yet to see the benefits of an improving economy start to experience this positively in their own lives.