"Competitive Performance In Irish Industry", Special Article in the Quarterly Economic Commentary, Winter 2004.

21/12/2004

"Competitive Performance In Irish Industry", Special Article in the Quarterly Economic Commentary, Winter 2004.

By Dr Eoin O’Malley (The Economic and Social Research Institute)

Article within ESRI Quarterly Economic Commentary, Winter 2004.



This article reviews the competitive performance of industry in Ireland by focusing on trends in industrial output, employment and exports compared to trends in the EU.

• Manufacturing output, employment and exports all grew much faster in Ireland than in the EU, so that Ireland’s shares of EU manufacturing production, employment and exports were much higher by 2001 than they had been in 1991.
• The largest increases in share of EU production, employment and exports occurred in the “modern” or “high-tech” sectors such as electronics and pharmaceuticals, which in Ireland are quite largely composed of foreign-owned multinational companies. However, a significant finding is that Ireland’s share of EU production and employment also increased in nearly all other sectors.
• Ireland’s share of EU industry was already rising strongly in most sectors at the start of the 1990s, before what is often identified as the “Celtic Tiger” period.
• Focusing on Irish indigenous or Irish-owned industry, nearly all sectors of indigenous industry increased their share of EU production and employment in 1991-2001. The export performance of indigenous industry compared to the EU was less convincing, but it was still reasonably positive.
• Some of the largest gains in Irish indigenous industry’s share of EU industry occurred in the “modern” or “high-tech” sectors.
• Rapid industrial growth in Ireland may have been led by overseas multinationals in the high-tech sectors. Nevertheless, there have also been broader areas of successful competitive performance, both extending into other sectors and including large parts of Irish indigenous industry.