Can we make it in Waterford? South-East Business Forum Jim Power March 11th 2014
WHERE ARE WE TODAY AT A NATIONAL LEVEL?
% ECONOMIC GROWTH PROFILE 15 10 5 0-5 -10-15 GDP GNP
IRISH ECONOMY IN 2013 Economy looked moderately better Export performance strong Construction sector starting to recover Consumer spending fragile tough environment for retailers Exchequer Deficit falling gradually Credit conditions still very difficult Housing activity stabilising strong growth in Dublin Consumer confidence at almost 7-year highs Greater sense of optimism
EMPLOYMENT (000S) 1,600.00 1,700.00 1,800.00 1,900.00 2,000.00 2,100.00 2,200.00 Q1 04 Q2 04 Q3 04 Q4 04 Q1 05 Q2 05 Q3 05 Q4 05 Q1 06 Q2 06 Q3 06 Q4 06 Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13
Jan-05 Apr-05 Jul-05 Oct-05 Jan-06 Apr-06 Jul-06 Oct-06 Jan-07 Apr-07 Jul-07 Oct-07 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 HOUSE PRICE INDEX 160 140 120 100 80 60 40 20 0 National - all Dublin - all Outside Dublin - all
Jan-06 Apr-06 Jul-06 Oct-06 Jan-07 Apr-07 Jul-07 Oct-07 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 % HOUSE PRICE GROWTH (YOY) 30 20 10 0-10 -20-30 National - All Dublin - All Outside Dublin -All
REASONS TO BE CHEERFUL External view of Ireland improving IDA companies increased employment by 13,367, Net Gain 7,071 EI 18,033 new jobs created, Net gain 5,442 Agri-Food Exports touching 10 bln Successful return to bond markets Debt upgrade from Moody s bond yields have fallen further Labour market starting to improve Consumer & Business Confidence strong Housing market improving Greater Dublin Area starting to move quite strongly
REASONS FOR CAUTION Dangerous levels of sovereign debt Taxation Personal & Corporate NAMA impact on property market Personal Debt Restoration of a functioning banking system Retail sector still pressurised Pressure on Government Expenditure will remain Regional performance still weak BUT Palpable sense that country has rounded the bend
FOREIGN DIRECT INVESTMENT (2013) IDA companies increased employment by 13,367, Lost 6,296 Net Gain 7,071 IDA supporting 161,112 jobs plus another 112,778 indirectly (0.7 multiplier) IDA winning in ICT, Social/Digital Media, International Financial Services, Pharma/Bio, Medical Devices 121 bln exports (73% of total exports) 62.4 bln Goods & 58.5 bln Services Irish economy spend 21 bln Payroll 8 bln IDA companies account for 70% Corporation Tax
THE CONTEXT FOR WATERFORD
LABOUR MARKET INDICATORS REGION UNEMPLOYMENT EMPLOYMENT PARTICIPATION RATE Border 13.5% 185,800 55.2% Midland 13.7%% 111,100 59.0% West 11.9% 185,900 62.2% Dublin 10.0% 572,100 62.2% Mid-East 12.5% 225,900 63.3% Mid-West 10.7% 151,300 57.2% South-East 15.5% 197,100 59.1% South-West 10.2% 280,600 58.7% State 11.7% 1,909,800 60.1%
GROSS VALUE ADDED PER CAPITA 160 140 120 100 80 60 40 20 0 Dublin South-West State Mid-West West Mid-East South-East Midland Border
DISPOSABLE INCOME PER CAPITA BY REGION 115 110 105 100 95 90 85 80 Dublin State Mid-East South-West Mid-West West South-East Border Midland
DISPOSABLE INCOME PER CAPITA BY COUNTY 115 110 105 100 95 90 85 80 75 70
LIVE REGISTER FLOWS AREA JAN 2012 JAN 2014 % CHANGE State 439,620 399,300-9.2% Waterford County 14,520 13,310-8.3% Dungarvan 2,320 2,070-10.8% Waterford City 12,200 11,240-7.9%
WHY REGIONAL GROWTH DISPARITIES? Factor endowments may vary between regions Technical progress may vary between regions Some regions more capable of producing & using technical progress than others Growth of capital stock may vary between regions Growth of labour force may vary between regions Imperative is to remove obstacles to growth in a region Pro-active approach at local level National policies questionable
REGIONAL GROWTH DRIVERS Factor supplies key determinant of growth Imperative is to increase productivity Capital Deepening Technical progress Capital & Labour tend to move to those regions offering greatest returns Capacity of region to create technical progress not simply a matter of investing in physical or human capital institutional environment key Collective learning process tends to create a knowledge rich environment > ideas transformed into new products & new ideas > raise labour productivity
IS THERE A FUTURE FOR WATERFORD? Tourism Agri-Food FDI Offering Educational Offering Amalgamation of local authorities a positive Self-help at a local level Marketing Infrastructure Quality of Life Issues Strategic unified approach essential Focus on Cork or Dublin?
THANK YOU!