ADVICE CENTRE: Brian Mooneyasks is there a future for Ireland's financial services industry?
The world has been stunned by the events of the past few months. Those working in the financial services industry in Ireland, and those in school and college considering careers in this industry, must be feeling uncertain regarding their career prospects. The world is facing into new realities, with far higher levels of worldwide regulation, and direct government involvement and supervision of the entire sector. The volume of credit generated by financial institutions has been out of all proportion to the deposits of savers, and is the direct cause of the current world financial crisis.
The industry, both in Ireland and around the world, will be rebuilt on the basis of the actual wealth generated by people's economic activity, the surplus of which will hopefully be deposited in financial institutions.
This new reality will initially lead to a severe contraction of financial services activity worldwide, as the various world economies begin to recover from the destabilising effect of recent events.
The more immediate issue is how Ireland can sustain current employment levels in the industry, which now accounts for 14 per cent of our labour force.
The key to future success lies in rearranging our activity away from a total dependence on the traditional relationships with London, Frankfurt, New York and Tokyo, towards the emerging economies of China, India, Indonesia, and Africa. As we survey the wreckage of the present system, we may be blinded to the fact that the growing economic strength of these territories offers Ireland the possibility of sustainable growthin finance in the years ahead.
That is why the Taoiseach is leading another government delegation to China, following up on a series of such visits in recent years. As an English-speaking country within the Euro zone, with attractive corporate tax rates and a very positive relationship with many of these economic areas, built up through the work of our missionaries, charities, and peace keeping activities, our financial services industry is well placed to consolidate its position in the emerging post-2008 world financial order.
What are the strengths that will enable us to sustain and expand this sector of our economy?
The financial services sector in Ireland has been, to date, one of the most successful in Europe, attracting new entrants and facilitating an increasingly competitive marketplace.
Ireland has also established itself as a major international financial centre, with many of the world's top banks offering wholesale and international banking services. Ireland has a young, well-educated and expanding population, with increasing female participation in the labour force and rapidly increasing levels of tertiary educational attainment.
Those in education interested in a career in financial services may consider careers in retail banking, mortgage finance, wholesale banking, funds management, insurance and pensions services, or in support roles such as accounting, auditing, legal, communications and marketing, and human resource management. If we build on our inherent strengths, we will move strongly beyond our present difficulties.
TALKBACK
Minister for Education Batt O'Keeffe gets full marks for securing a 3.2 per cent increase in his department's budget for 2009. In the teeth of the worst budgetary cutbacks in a generation, to secure an increase of almost 10 per cent in the school building programme shows that he is fast becoming a major force at Cabinet level.
Many voices have called on the Government to accelerate this programme, to provide children with a quality environment in which to learn, and to provide the tens of thousands of recently unemployed building workers with employment in Ireland through the coming years. Hopefully, these skilled craftsmen will be still working in Ireland and available to the wider construction sector, when the recession lifts in two to three years.
The increase of 12 per cent in the capitation grant at primary level to €200, as well as the equalisation measure for voluntary secondary schools, of an increase of €22 in their capitation grant per pupil, is also to be welcomed.
Having called in this column, in recent weeks, for the provision of a comprehensive psychological service to all schools, so that all children with special educational needs have access to a NEPS psychologist, I am pleased that the Minister has increased the NEPS budget by 33 per cent, to enable all schools to have a psychologist appointed by 2009.
The fee-paying schools have taken a real hit in this Budget, seeing their pupil teacher ratio increased from 18:1 to 20:1. Parents in these schools will have to dig deep to replace one teacher per 200 pupils as State-funded teachers retire.
Finally, all schools at both primary and post-primary level are going to experience real pain in adjusting to the new reduced pupil-teacher ratios, as well as the wide range of cuts in their services budget.
You can talk back to Brian Mooney at talkback@irish-times.ie
