Manufacturing – Ireland’s Top Performing Sector 2018
The Irish economy is the fastest growing economy in the Eurozone and the 6th most competitive in the world. As the most important sector in Ireland’s economy, manufacturing has been transformed over the past 20 years by globalisation, technology and the growth of emerging markets. The sector has earned the reputation today as a dynamic global centre of (advanced) manufacturing excellence, showcasing world-class production facilities and a highly adaptable, creative and innovative workforce.
Sector Breakdown 2018
Pharmaceutical products and preparations account for 37% of production in Irish manufacturing. This is followed by food products (18%), chemicals & chemical products (15%), computer,electronic,optical & electrical equipment (11%), other manufacturing, repair & installation of machinery, equipment & tobacco (7%) and basic metals & fabricated metal products,machinery & equipment (5%).
Strong Continued Growth In 2018
In January 2018 the sector began the year with a positive start. The widely used index for measuring the manufacturing activities in Ireland, the Manufacturing PMI (Purchasing Managers Index), registered 57.6 for January 2018. This was driven by strong continued demand from domestic and overseas customers. Employment in the sector also continued to grow. In June 2018 new orders were the highest received in H1 2018, driven by increased demand.
Manufacturing Production in Ireland increased 4.9% in November of 2018 over the same month in the previous year. In November 2018 business conditions in the sector improved for the 66th consecutive month. Manufacturing Production in Ireland averaged 8.19% from 1981 until 2018. The sector also witnessed an expansion over the last 18 consecutive months.
The rate of employment growth in Ireland’s manufacturing sector fell to a 14-month low in November, however, business conditions in the sector have improved for 66 consecutive months.
The IHS Markit Ireland manufacturing purchasing managers index (PMI) increased to 55.4 in November, up from 54.9 in October. The PMI is an indicator designed to provide a single-figure measure of the health of the industry.
A “marked increase” in new orders was central to the improvement in operating conditions in the market while growth of new work accelerated from October.
Manufacturers raised production for the 28th consecutive month in response to higher new orders while the rate of output expansion quickened in the month, the data shows.
Forecast For 2019
And while workforce numbers rose for the 26th consecutive month during November, the rate of employment growth started to ease. However, the industry is increasingly optimistic with over 50% of manufacturers confident of a rise in output from present levels over the course of the next 12 months.
Skills In Demand 2018
Set against this strong background of manufacturing growth, however, a survey in May 2018 of over 250 manufacturing SMEs in the top five sectors (including building materials, print and packaging, equipment assembly, timber and food) found that significant nationwide skills gaps exist amongst manufacturing SMEs in Ireland;
- Despite 28% of SME companies in Ireland hiring new staff since the start of 2018, 44% said that maintaining and hiring a skilled workforce is a real concern for the future
- Over 50% of larger SMEs across Ireland said sourcing engineers is a problem
- Nationally, SMEs were most concerned about the lack of skills in marketing, sales and production
- Outside of Dublin, retention of production staff is a real challenge for more than one in three SMEs
- More than half of Munster businesses said the lack of skills would be a major problem in the future, compared to 22% of Dublin firm
- In the future skills, a shortage could impact expansion and succession plans by SMEs
- Retaining talent was a bigger problem for SMEs than larger organisations, however, 41% do not regard investing in training as valuable or may not have dedicated resources to address it. Wage increases were the most commonly relied upon staff-retention strategy, used by a quarter of firms, while one in six said location is a primary pull factor. Incentives by firms in Connacht and Ulster such as flexi-time, pension schemes and health insurance have proved to be successful in retaining more staff than Munster and Leinster
- Brían Evans, Head of Manufacturing at Bank of Ireland said; “Leading sector indicators over the past few years have shown consistent employment growth and increased demand for Irish produced products in home and export markets. After Brexit, the hiring and retention of a skilled workforce is one of the main challenges for manufacturers. With unemployment in Ireland at the lowest level since before the financial crisis in 2008, competition for skilled workers is increasing across industries with recent research from the construction sector also highlighting major challenges”.
The reality is that manufacturing companies, both SMEs and large global organisations across Ireland will miss opportunities if the skills gaps are not filled. Acquisition of new staff and retention of existing staff will be critical for business sustainability.
Ten Live Is A Leading Global Manufacturing Recruitment Specialist In Ireland
For Information Regarding Our Manufacturing Skills Recruitment Services In Ireland Contact:
Joanne Telfer
Director
Ten Live Group
Award-Winning Global Manufacturing Recruitment Experts
Mob: ++44(0) 7547 761779
Email joanne@tenlivegroup.com
Skype: joanne.telfer4
Tel: ++44 (0) 1236 702007
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