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9. The impact of it on employment

An awareness of the potential for IT development was evident in Ireland in the 1970s. Influenced by the rapid growth of the electronics industry in the United States, there were expectations of Ireland participating in this global industrial expansion. Hence the targeting of electronics by the IDA in its industrial plans. IT was regarded as being "characterized by high technology, high skill, labour intensity, propensity to expand, good working conditions, environmental acceptability, low transport costs and low energy use."⁴³

Employment Projections

Electronics Industry

The earliest projections for employment were based on the initial successes by the IDA in attracting overseas investment in that sector during the 1970s. As of December 1980, it was claimed that about 700 multinational companies had begun operations in Ireland, employing over 10,000 people.²⁴ This provided the overly optimistic forecast of 25,000-30,000 employees in the industry by 1985, of whom 11,500 were expected to hold university degrees or be skilled personnel. The precise composition of that projection is set out in table 1. 11.

Table 1.11. Projected employment composition of the electronics industry in Ireland by 1985

Source: Ref. 24.

Some concern was expressed by the Telesis Consultancy Group in 1982 concerning the prevailing levels of skill development and the sub-assembly and assembly nature of plants in the Irish electronics industry. It was recognized that few electronics companies in Ireland at that time undertook any significant marketing, product or process research, and development or integrated manufacture.²⁴ The report went on to comment that, by 1980, "only about 1% of the employees are currently engaged in engineering activities, only 1% are skilled craftsmen, and only 5% are technicians. Managerial personnel constitute only about 4-5% of total employees."²⁴

It is argued that the projection of 25,000-30,000 employees in electronics-based firms, of whom at least 10 per cent would be engineers, was based on false assumptions. These were that:

(1) aggregate employment in electronics would rise at a rate similar to that already experienced in the United States, and
(2) the skill structure of the workforce would be similar to that of the US industry.

As this report has stressed, the range of products/processes in the Irish electronics industry, and hence appropriate skill requirements, has not replicated the "Silicon Valley" example.

Subsequent forecasts by the Manpower Consultative Committee (MCC) have continued to emphasize the importance of the electronics industry to the manufacturing sector, in terms of contributing to higher output, productivity, and employment. Within the electronics industry, the percentage of engineers employed in 1985 was estimated at 5.6 per cent, and for electronics technicians the equivalent figure was 10 per cent. These were expected to rise significantly by 1990 to 9 per cent for engineers and to 15 per cent for technicians.⁴⁴

Data Processing

Table 1.12. Forecasts of data-processing staff up to the end of 1981

Source: Ref. 45.
a. 1979 figures equal sum of estimated employment from survey and current vacancies.
b. 1981 forecast includes estimates of demand related to IDA programmes.

In 1980, the Manpower Consultative Committee noted from its survey that approximately 5,400 people were employed in automated data-processing occupations. A shortage of systems analysts and computer programming staff was identified and it was estimated that there were vacancies for about 250 software staff. According to the respondents' projections, demand from existing users for systems analysts and programmers was expected to grow by 14 per cent per annum in 1980/81. When the MCC took account of the likely spread of computer utilization and the impact of the IDA Services Industries Programme, these estimates were revised to 22 per cent p.a. increase in demand for systems analysts and 26 per cent p.a. for programmers.⁴⁵

According to an estimate by the MCC, 390 organizations in Ireland were employers of computer staff in late 1979. Based on this information and the anticipated increase in demand by newly computerized firms and IDA-sponsored service industries, the MCC drew up forecasts for data-processing (DP) staff. These are set out in table 1.12. These projections were more cautious and are more likely to have been realized than those for the electronics sector. Tentative estimates of the percentage of managers and supervisors with engineering qualifications were 40 per cent and 25 per cent respectively in 1984, rising to 50 per cent and 35 per cent in 1990. The number of managers/supervisors with engineering degrees in the electronics industry was estimated at 496 in 1985. An anticipated figure for 1990 was 689. This figure is still well below those projected in table 1.11.⁴⁴

The Growth in IT-related Employment

Computer Users

The earliest data for IT-related employment in Ireland cover only data-processing staff. The survey in 1969 identified 1,231 DP employees among commercial in-house organizations, 62 staff in universities and research institutes, 765 in organizations using bureau services, and 196 employees in commercial bureaus.⁷ Table 1.13 indicates the DP occupations in these organizations.

Table 1.13. The number of people employed on computer work at the end of 1969

Source: Ref. 7.

By 1980, it was estimated that the number of employees directly engaged in computer-related employment was 5,427. The breakdown by occupation of these employees is given in table 1.14. Relating the data in this table to overall employment in these sectors, the most computer manpower intensive sectors in 1979 were finance/business/computer services, the public service, and manufacturing industry. Within the occupational categories, the most significant group was that of "other data-processing staff." While this includes some highly skilled workers (such as sales engineers), it is mainly composed of people in routine clerical work - data control and data preparation.

Comparing tables 1.13 and 1.14, it is worth noting some changes over the decade:

(a) managers (data-processing managers, systems managers, operations managers, etc.) accounted for 1.2 per cent in 1979 as compared with 4.8 per cent in 1969/70;

(b) operations staff had more than doubled from 8.2 per cent to 21.9 per cent;

(c) the proportion of analysts and programmers increased from 6.6 per cent and 4.7 per cent in 1969 to 10.6 per cent and 15.3 per cent in 1979;

(d) the category of "other data-processing staff" had been reduced from 54.2 per cent to 35.9 per cent, which would have reflected the reduction in data preparation staff.

In terms of skill shortages, the MCC identified software occupations as accounting for almost 63 per cent of data-processing vacancies in the companies surveyed. No more recent data are available for data-processing employment in Ireland.

Table 1.14. Estimate of data-processing employment, 1980 (all 390 organizations)

Source: Ref. 45.

Table 1.15. Employment in electronics, 1973-1981

Source: Ref. 47.

Electronics Industry Employment

Whereas the electronics industry in 1973 consisted of about 26 firms, by 1984 the number had increased to almost 160 firms. Total employment in the industry is believed to have grown from 12,000 in 1981 to about 15,000 people in 1984.⁴⁶ Table 1.15 sets out the employment trends from 1973 up to 1981.

This fairly consistent growth since 1973 masks some changes within the industry. According to Cogan and O'Brien, there was virtually no increase in aggregate employment between 1973 and 1981 in the firms that had existed in 1973. The vigorous growth in employment was attributable to new startups, a development that was examined in section 4 of this report. Most of the employment growth in the Irish electronics sector came from multinational corporations. Only about 500 sustained jobs had been created by indigenous companies since 1973.⁴⁷

Commenting on the relative levels of productivity within three key industrial groups, the Department of Industry and Commerce referred to only a small net employment growth in electronics, despite high productivity growth in the 1980s. The report expressed concern about concentration on a few subsectors (food, electronics, and chemicals) since "industrial output [is] increasingly vulnerable to cyclical downturns in international demand in the case of Electronics (particularly where the Irish operation is one of a number of production units of a multinational)."⁴⁸

Table 1.16. Employment in electronics companies,^a by region and sex of employees, 1988

Source: Unpublished data from FAS, 1988.
a. Designated manufacturing and service firms identified as being engaged in a variety of activities from telecommunications and computers to process control. The one thing they have in common is that they wholly or substantially share a common technology which is largely semi-conductor or microprocessor based.

The level of employment in the electronics industry in 1988 is set out in table 1.16. Of the 15, 459 persons employed, over 95 per cent were in FAS-levied companies in which the annual wage/salary bill was in excess of IR£100,000. The significant regions for electronics employment were Leinster (which includes Dublin) and Munster (with Cork, Limerick, and Shannon). Employment in Connaught would have been mainly in the Galway area. Few electronics companies had been attracted to the Ulster region (counties Cavan, Monaghan, and Donegal).

Women workers comprise 45 per cent of the electronics workforce in Ireland. The majority of the approximately 7,000 women employees are semiskilled assembly workers. The proportion in professional occupations remains very low.⁴⁶

Table 1.17. Occupational structure of the electronics industry in the USA, UK, and Ireland, and of Irish manufacturing industry, 1980/81

Source: Ref. 46.
a. "Operatives" (USA, UK, all Irish industry); "Non-craft production workers" (Irish electronics).
b. "Labourers" (USA); "Others" (UK, Irish electronics, Irish industry).
c. Within the AnCO category "Professional, administrative and clerical", each occupation listed has been allocated into one of the three categories used here. The number comprising the "All others" occupation has been allocated to each of the three categories in the proportion that they make up of the overall category.

Skill Patterns in the Electronics Industry

The skill component of the electronics industry in Ireland is important for several reasons:

(a) it has a relatively high proportion of professional and technically trained workers, which implies that it is not as vulnerable as other industries to low-wage competition;

(b) a greater value-added per work-hour would be expected from a skill-intensive sector, such as electronics, than from capital-intensive industries;

(c) Ireland has a young and well-educated population and spends a high proportion of its national income on education;

(d) international comparisons can be made and used to monitor the industry and Ireland's progress.

The occupational structure of the electronics industry in Ireland, the United Kingdom, and the United States is set out in table 1.17, along with the structure within the Irish manufacturing industry as a whole.

In international terms, employment in Irish electronics factories is qualitatively intermediate between the United States and newly industrializing countries. According to table 1.17, proportionately more assembly workers and fewer technicians and professionals are employed in the Irish than in the US electronics industry. In purely Irish terms, the industry is highly skilled. There is a higher proportion of technicians and professional employees than in the rest of manufacturing industry. Instead of "blue-collar" craft workers, there is a "white-collar" tier of technicians.⁴⁶

Within subsectors of the electronics industry there are different occupational and skill patterns. In table 1.18 the percentage of engineers/ technicians is broken down by product group. This table shows that the complex electronics products such as instruments and industrial control and telecommunications products require more technical manpower than standard products and components.⁴⁷

In total, employment of about 16,000 in the electronics industry in 1987 reflected a less than spectacular growth in the sector since 1973. The level was well below that projected by Killeen in 1979. In fact it represents a figure that was less than half the number employed in that sector in Scotland and only a little more than half as many as in Berkshire in the United Kingdom. It is also calculated that total employment in Irish electronics was probably less than the annual increase in electronics jobs in Bavaria, Germany, during the 1980s.⁴⁹

Table 1.18. Density of technologists in the Irish electronics sector according to product group

Source: Ref. 47.

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