IDA Ireland delivers record job growth despite tech slowdown

The Government still expects the Irish economy to benefit from a “huge expansion” in the global information technology sector over the coming years despite a slowdown in the sector in 2022, Minister for Enterprise Leo Varadkar has said.

The Tánaiste, speaking at the publication of IDA Ireland’s annual results for 2022, said the Irish economy still has a “strategic advantage” over its rivals when it comes to attracting foreign direct investment.

However, he said that the Government would have to deliver substantial improvements in infrastructure over the coming years to maintain this advantage.

It comes as IDA Ireland, the agency charged with attracting foreign direct investment to Ireland, announced its best job creation figures to date with the numbers employed in the multinational sector now topping 300,000 for the first time.

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The agency on Monday reported a “substantial increase” in employment at its client companies in 2022 despite worsening economic conditions and a slowdown in the global tech sector.

In its annual results for 2022, the inward investment agency said that total employment at IDA companies now stands at 301,475, an increase of more than 33,400, or 9 per cent, from 2021.

IDA Ireland said job losses within the ecosystem of companies it supports remain at “historically low levels”.

Slightly more than 8,400 jobs were lost at the agency’s clients in 2022, it said, giving a net jobs gain of 24,019 for 2022 alone.

However, the survey of companies from which the agency’s results are drawn took place before October 31st, after which a number of high profile IDA clients – including Meta, Twitter, Stripe and Zendesk – announced significant Irish job losses.

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Those cuts will be included in the agency’s 2023 results, said IDA interim chief executive Mary Buckley.

Overall, the agency said it won 242 investments this year, roughly in line with 2021 when it secured 241 investments. Some 103 of the 242 investments won in 2022 were new companies to Ireland.

Just more than half of the investments won this year went to regional locations, the IDA said, with employment growth in every region of the State.

“The strong growth of the past decade in FDI employment continues in 2022 despite turbulent global environment,” Ms Buckley said.

Looking forward, the agency said there was a positive pipeline for the first half of next year but that the outlook was more uncertain for second half of 2023.

“Sustaining Ireland’s FDI performance in this climate of significant uncertainty, with persistent risks, requires a renewed focus on capacity constraints and competitiveness challenges,” Ms Buckley said.

“These are the best ever FDI employment figures in a single year,” said Mr Varadkar. “The 24,019 net new jobs represent a 43 per cent increase on 2021, which itself was a record year. The numbers directly employed in the multinational sector have also surpassed the 300,000 mark for the first time.”

“We don’t expect every year to be the best year on record. But we are confident that we will see further growth next year.”

He said: “Notwithstanding the recent retrenchment in the tech sector, we all know that the future is digital. [Ireland has] a strategic advantage with a rich ecosystem of multinational and indigenous technology companies and we have incredible expertise within those companies and our academic institutions which we must harness to its fullest. There will be a huge expansion in the tech sector in the medium term.”

However, Mr Varadkar also said that maintaining this advantage “isn’t just about having the right business environment. It’s also about providing the necessary infrastructure expected from advanced economies and acknowledging the real shortcomings in these areas”.

He said that investing in infrastructure, particularly housing, is a “major priority” for the Government over the next two years and in the long term with its Project Ireland 2040 initiative.