Bernard Durkan (Kildare North, Fine Gael)
Link to this: Individually | In context

Question 118: To ask the Minister for Enterprise, Trade and Employment if he has had discussions with the manufacturing industry with a view to identification of cost factors prohibitive to investment or job creation here; his proposals to address the matters arising; and if he will make a statement on the matter. [19353/07]

Micheál Martin (Cork South Central, Fianna Fail)
Link to this: Individually | In context

Manufacturing is an important and integral part of the economy, directly employing almost 250,000 people. During 2005 the sector spent €25bn on Irish labour, material and services and contributed almost 30% of corporation tax receipts. Over the last two decades however there has been a structural shift in the economic composition of developed economies. In the OECD countries, this has resulted in a decrease in the numbers employed in manufacturing.

In Ireland, in line with other developed countries, the decline in manufacturing has been more pronounced in traditional manufacturing sectors such as textiles. The country is no longer a low cost economy and manufacturers in particular are facing increased competition from producers in lower cost economies. The model of manufacturing in developed countries is changing and Irish enterprises are adapting to those changes and engaging in higher value added activities in order to compete in the global marketplace. Thus, while employment in some traditional sectors has declined, these jobs have been replaced with employment in higher value activities. To put the decline in manufacturing employment in context, half a million new jobs have been created in Ireland since 1997.

Nevertheless, in recognition of the particular difficulties facing the manufacturing sector the High Level Group on Manufacturing was established under the Towards 2016 Social Partnership Agreement. Its terms of reference as set out in Section 7 of that Agreement are to review the challenges facing the manufacturing sector and, having regard to initiatives currently underway, identify any further measures that would help to meet those challenges.

The Group, membership of which is in accordance with the standard tripartite model for Social Partnership, comprises four representatives for each of the three main partners, IBEC, ICTU and the Government, and is chaired by a senior industry representative.

The Group has met on five occasions since February of this year and is examining a range of issues concerning the performance of the sector and the challenges it faces. The Chairman of the Group is due to report to the Partnership Forum later this month with a progress report on the Group's work to date.

While my Department is providing the Secretariat for the Group, it should be noted that it has been established under the auspices of the Partnership process, and is mandated to report on its deliberations to that Forum.