Thursday, 20 September 2012
Topical Issue Debate
I thank you, a Cheann Comhairle, for giving me the opportunity to raise this issue and I thank the Minister of State, Deputy Sherlock, for taking the debate.
Figures released by the Central Statistics Office, CSO, yesterday may have got lost among everything else that was happening in the House. They are incredibly stark. The total number of people unemployed, according to CSO measurements, is 308,500. The long-term unemployment rate has increased from 7.7% to 8.8% over the year to the second quarter of 2012. Long-term unemployment accounts for 59.9% of total unemployment in the second quarter. That figure, in itself, is incredibly stark and it has been rising consistently for the last number of years.
I know the Minister of State will outline a list of initiatives that people think are working and that we want to work. I have been that soldier. However, they are not working, as is illustrated by the CSO figures. The long-term unemployment figures are particularly worrying. These people are moving into a situation where they may become unemployable and suffer all the consequences of long-term unemployment.
Despite this, we have a skills shortage. We have companies that cannot fill vacancies. I pay tribute to the IDA and to the work it is doing and acknowledge the announcements made this week, but some IDA client companies are unable to fill vacancies. We have a skills challenge as well as an unemployment challenge. Surely, somewhere in Government system - I am not speaking about the political parties - someone needs to knock heads together and match up the skills shortage with the 308,500 people who are unemployed, 60% of whom are long-term unemployed.
We are putting so much effort into getting a deal on bank debt and fiscal debt. When the Government came to office the Tánaiste moved the trade function to the Department of Foreign Affairs to beef up that Department and make it more commercial. However, in Ireland and across Europe, governments are not putting a similar level of effort, fire power and imagination into resolving the unemployment problem. We see the measures Ben Bernanke has announced in the United States, where the unemployment rate is 8%. That is the kind of fire power we need on an EU-wide basis.
Many of those who are unemployed come from a construction background, and the country still needs major capital investment. Many of them could do with the old style conversion courses that were run back in the mid and late 1990s, although the course content may need to change. That would allow people to move their skills over the course of a year or 18 months into technology or to where there are labour market vacancies. We need a huge investment in that kind of course.
If the message goes out to the multinational community that Ireland is a great place to invest but the jobs, when they are announced, cannot be filled, we will lose further jobs to places such as Singapore, to the BRIC countries and elsewhere. Meanwhile, 308,500 people are looking for work.
The Minister of State will read the list of jobs initiatives and funding for businesses. I know the loan guarantee scheme is on the way and I congratulate the Minister of State and the Minister for Jobs, Enterprise and Innovation on that measure. The opposition to it in the Department of Finance was intense but it was eventually brought over the line. It is incredibly important. Businesses and employers are crying out for capital investment from banks and they are not getting it. The banks, the Government and various Departments come up with figures but all of us in the Chamber know it is not happening on the ground. Very little new investment is happening. Without new investment we will not create jobs. I do not speak in any party political sense. As an Oireachtas, we have a duty to the country to put this issue front and centre.
I thank the Deputy for the tenor in which he made his contribution. I acknowledge that the latest quarterly national household survey, QNHS, figures show an increase in unemployment, but we never said recovery would be fast or easy.
The Government inherited a jobs market in free fall with more than 250,000 private sector jobs lost in the three years before we took office. That is not a political charge; it is a fact.
At the peak of the boom, almost 24% of GNP was attributable to construction, 12% of total employment. The economy is in transition and since assuming office, we have delivered on the plan to build a new economy. Part of this is supporting a transition from the old failed economy based on property, banking and debt to a new sustainable economy based on enterprise, exports and innovation. The Cabinet sub-committee on economic recovery and jobs, through the action plan for jobs, has direct identifiable targets that are addressed directly with the Taoiseach on a regular basis using that reporting mechanism. Part of that process involves the small business advisory group, which includes all of stakeholders, such as ISME and IBEC. They are part of the process of getting the recovery we so badly need.
Deputy Calleary mentioned the skills shortage. There is a constant engagement with industry. I met with Google the day before yesterday to see how we could get a further engagement with such companies on the STEM area and that will directly feed into how we address the skills shortage. There are already programmes in play in terms of bridging courses but we must ensure there is a longer term policy goal that ensures we have a throughput of students from secondary into tertiary who are actively engaged in the STEM agenda, through courses such as Project Maths, so the right sort of software engineers and ICT graduates exist for the skills pool needed to sustain the economy in the longer term.
Unfortunately, as part of the necessary transition, jobs continue to be lost in construction, banking and the public sector as these sectors return to more realistic levels. While the headline numbers out of work have risen in the latest returns, the CSO data show that, on a seasonally adjusted basis, there was a quarterly decrease of 3,700 in the number of persons unemployed in quarter two compared to quarter one, from 312,000 to 309,000.
We are in a period of transformation of the public sector as a necessary step to managing our public finances in a better way. The number of employees in the public sector has declined by 25,800 or 6.3% in the year to June 2012 while the number of employees in the private sector decreased by 0.3% over the same period. This is an improvement on the decrease of 2.2% in those employed in the private sector in the previous year.
The Minister of State mentioned the small business advisory group. Small business will be the engine of recovery. Yesterday, Senators Feargal Quinn and Mary Anne O'Brien hosted a briefing by those who make up the small business advisory group in their independent capacity on the proposals - or kite flying - by the Minister for Social Protection on employee sick pay. Her suggestion has been floating around for a while now that she will completely change that regime. Small businesses are incredibly nervous about the potential impact of that proposal on existing business and their ability to create employment, even if we enter a phase of growth. What is the Minister of State's view on this issue? Has the Department of Jobs, Enterprise and Innovation taken a view on those proposals?
What are we doing at EU level? As a small country with one of the most open economies in the world, are we brave enough to bring proposals to the EU to challenge it to act on unemployment as a bloc in the way we saw the US Federal Reserve acting this week? As well as getting the deals we need on banking and fiscal debt, we must get a programme to deal with unemployment.
I am not in the business of creating expectation but last December the Taoiseach, referring to the end of year figures, said that he hoped by the end of this Government that anyone currently long-term unemployed will have re-entered the world of work or become involved in upskilling or a change in direction. Of the 308,500 people unemployed, 60% are now long-term unemployed. How many of those will have a job by the end of 2015?
The Deputy has stood where I am standing today and knows I will not be drawn on the budgetary process. Let me talk, however, about the EU Presidency. One of the central themes of the Irish EU Presidency will be job creation. There will be statements on Ireland's position on getting Europe to engage on this agenda in due course. The planning is ongoing and this week there was a Cabinet sub-committee on European Affairs where each of the Ministers and Ministers of State involved had an opportunity to discuss the EU Presidency and the core themes we want to ensure are at the forefront. Job creation and growth with the European economy will form part of that.
I take the Deputy's point on the public utterances of Ben Bernanke on the US Federal Reserve. There is a different dynamic in the US because it operates on a federal basis. There is a challenge for a member state like Ireland to ensure greater EU co-ordination but it is the Government's view that the role of job creation must be to the forefront of the Irish Presidency.
Horizon 2020 is a major pot of money, around €80 billion, that must be negotiated, along with the multiannual financial framework. There are many Irish companies that will ultimately benefit from that once it is negotiated. It will do more to inject further capital into the research and development arms of Irish companies and SMEs in particular to create those jobs that we want in the economy. There is much to be done on the macroeconomic side. I reiterate, however, that the action plan for jobs is a clear policy statement by the Government that involves all of the stakeholders, including small business, IBEC and so on. That will be a key driver for job creation in the future.