BELFAST BRIEFING:Inward US investment is key to the North's recovery but a skills shortage could derail those hopes
NORTHERN IRELAND’S latest investment mission to the United States takes place this week, with the North’s First and Deputy First Ministers set to enjoy a starring role in Hollywood later today.
Peter Robinson and Martin McGuinness are hoping to secure “substantial inward investment” from their five-day trip during which they will meet senior executives from the technology, entertainment and financial sectors.
The Ministers are keen to play more than a walk-on part in the latest instalment of Northern Ireland’s long-running production to woo new investors to the North. This time around they are also calling in on chief executives from five of Hollywood’s major film studios and will also take part in a high-tech event at Sony Picture Studios showcasing innovation in entertainment.
The North has been quietly building up a reputation as a film location to rival that of the South. Its success in securing the production of the film Your Highnessand the HBO series Game of Throneshave not only delivered a multimillion pound boost for the local economy but have also helped to create jobs.
The government-backed agency for the industry in the North, estimates that its production investment fund returned more than £28 million (€32.6 million) to the local economy last year.
Anything Robinson and McGuinness can do to help will be applauded at home, but are they in danger of casting themselves in a “mission impossible” role when it comes to other aspects of their trip?
Northern Ireland has been aggressively marketed as “an ideal near shore” location for software development centres, financial services middle and back office support centres and IT technical support centres.
A cluster of big American financial services companies from Citi, to the Allstate Corporation, Liberty Mutual and NYSE Euronex, have set up operations in the North. According to Invest NI, the regional business agency, the financial services industry employs more than 23,000 people in more than 1,200 firms.
These US investors were wooed to the North with promises that it offers a “high quality, cost- competitive location” and a “highly skilled workforce”. It is a script which Robinson and McGuinness will most likely be following during their US trip.
Some back home however have begun to question whether the Ministers might be in danger of “overselling and under- delivering” on what exactly new smart sectors investors will get for their money. There is a growing debate about what has been identified as a “sustainable skills gap”. Many within existing smart services sectors, particularly financial services and ICT, wonder just what size of industry the North can support with its existing skills base.
According to Bro McFerran, managing director of Allstate Northern Ireland, one of the largest US inward investors, there is “a chronic lack of skills” in the marketplace at the moment. Allstate NI, established in Belfast in 1999, provides software development services and business process solutions to its parent’s global operations.
It employs more than 1,500 people but McFerran says if more of the right skills had been available in the North at the right time, “we would have been a bigger company”.
Last year Allstate NI embarked on a recruitment drive to fill 350 vacancies – and had to go as far as India to fill some of them.
McFerran is worried that the pool of talent is being overfished and that it would be better to “stack the shelves high with skills” first and then sell the North as an investment location.
Moreover, it is not just inward investors that have expressed concerns about how quickly operators in the smart sectors in the North are snapping up local graduates.
Fast growing Newry-based First Derivatives has completed a third of a planned three-year recruitment drive in just six months. Adrian Toner, the company’s chief operating officer, said 114 out of a 359 planned new posts have already been filled.
Toner said the single biggest impediment to the company’s growth could be not finding the right people with the right skills.
Founded in 1996, First Derivatives provides software and consulting services to the capital markets sector, a business boosted by the volatility in world financial markets.
However Toner has warned that if First Derivatives cannot find the right skills – North or South – it will have to “look elsewhere” to ensure its rapid business growth continues.
He is hopeful that a number of new initiatives being pursued by universities in Northern Ireland to address the skills problem will create a solution.
Meanwhile, it might be something First Derivatives might like to mention to Robinson and McGuinness when they wrap up their trip later this week by officially opening the Newry company’s first New York office.
