Written answers
Thursday, 24 October 2024
Department of Enterprise, Trade and Employment
Enterprise Support Services
Bernard Durkan (Kildare North, Fine Gael)
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159. To ask the Minister for Enterprise, Trade and Employment the extent to which he foresees the availability of sufficient resources to ensure adequate investment and activity in the manufacturing and services sectors; the extent to which investment has fluctuated in each in the past 12 months; and if he will make a statement on the matter. [43864/24]
Peter Burke (Longford-Westmeath, Fine Gael)
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My Department continues to monitor challenges to the manufacturing and services sectors of the economy. Despite the economic challenges posed by the pandemic, the services and manufacturing sectors have proved resilient, along with the Irish economy at large.
With an unemployment rate of 4.3% in September, the Irish economy is operating at a level close to full employment. The risks to employment will depend on the risks to the economy, more broadly. Real GDP growth is projected to be -0.2% in 2024 and 3.9% in 2025, according to forecasts published by the Department of Finance as part of Budget 2025.
Manufacturing is a critically important sector of the Irish economy, with clusters of world class manufacturing operations in areas such as biopharmaceuticals, engineering, medical technology, building materials, and food production. The latest Labour Force Survey data shows that there are 341,900 people employed in the industry sector as of Q2 2024, a substantial increase over the 286,300 people employed in the sector in Q2 2019, just before the start of the COVID-19 pandemic. In the manufacturing sector specifically, the most recent data available demonstrates the sector added over €192 million in gross value in 2022, an increase of more than 70% from 2019, when the sector added €112 million in gross value. In addition, recent CSO data on industrial production and turnover in manufacturing industries shows growth for 2023 relative to 2019 (the pre pandemic baseline) of 64% and 43% respectively.
The services sector – the largest sector by employment in Ireland – employs over 2.1 million people as of Q2 2024. This is substantially higher than pre-pandemic levels, with just under 1.8 million people employed in Q2 2019. In the wholesale and retail trade, and the accommodation and food service sub-sectors, employment levels have increased from 298,900 and 182,600 people in Q2 2019, to 314,600 and 184,200 people in Q2 2024, respectively. Administrative and support service activities have also seen an increase in employment levels over the same period, rising from 109,800 people employed to 112,200.
Investment levels in the manufacturing sector increased in 2023 compared to 2022 but remained below the levels seen over 2019-2021. Gross Fixed Capital Formation (GFCF) for the sector in 2023 was €38.2 billion (in constant prices). In the services sector, GFCF for administrative and support service activities increased from €13.7 billion in 2022 to €14.3 billion in 2023 (below the €18.7 billion recorded in 2019). However, for wholesale and retail trade, and accommodation and food services, GFCF has increased over the same period, from €1.7 billion and €0.47 billion in 2019, to €2.2 billion and €0.48 billion in 2023, respectively.
My Department will continue to monitor developments and risks in sectoral economic activity, while pursuing pro-enterprise and pro-competitive policies, guided by the White Paper on Enterprise. Published in December 2022, the White Paper on Enterprise 2022-2030, sets out Ireland’s industrial policy for the medium- to long-term, building on Ireland’s strengths of an open economy with strong trade and foreign direct investment, a vibrant innovation hub, and a resilient labour market. This review of Enterprise Policy was motivated by an awareness of a changing enterprise landscape posing new challenges, including shifting patterns of globalisation driven by geopolitical change, disruptive technological innovation, and lagging productivity in parts of the indigenous sector of the economy.
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