There has been a broad welcome from Ireland's leading human resource managers to the proposed FAS campaign to meet skill shortages in the economy by targeting skilled Irish emigrants. However, a number of labour market specialists speaking at the Institute for Personnel & Development (IPD) conference yesterday expressed concern that the rising cost of living in Ireland, particularly in the accommodation area, would prove a significant obstacle to many people thinking of returning home.

The director of the IPD, Mr Mike McDonnell, called on the Government to seriously consider the provision of low cost housing to help overcome accommodation problems.

"If the IDA can build advance factories for companies, what's so very different about building advance housing?" he asked.

He said that local authorities, private-public partnerships or companies themselves could build accommodation for rent.

FAS is to start its campaign next month, initially targeting recruits in areas such as teleservices, electronics and the construction industry.

The campaign will concentrate on Britain, Germany, France and the Benelux countries, the US and Canada.

The aim is to build up a database of 10,000 qualified job-seekers actively seeking to return to Ireland.

Yesterday, a FAS spokesman said that about 20,000 people a year were immigrating to work in the Irish economy but, contrary to popular belief, they were not all returned emigrants.

Over the years when Ireland had been a net exporter of people, it had built up a valuable network of contacts with other employment and training agencies in other countries, he said.

"Now that the tables have turned, FAS is using these links to seek overseas workers for Irish employment opportunities."

Welcoming the announcement yesterday, the European human resource manager of Analog Devices, Mr John Horgan, said that his organisation was going to jobs fairs in Boston and New York next month - the Irish Technology Careers Expo - to recruit 50 electronic engineers. At present the company employs 400 engineers among its 1,300-strong workforce in Limerick.

"If we could get these people, we could get the extra business," he said. FAS was very responsive to employers' needs, he added.

High technology employers are not the only ones suffering shortages. Mr Michael Donnelly of Bus Eireann said that about 10 per cent of the drivers they recruited annually were from abroad. Most of them were Irish emigrants who wanted to return home from Britain, often to small towns or rural areas, he said. "But we also employ a couple of Bosnians."

Both Mr Horgan and Mr Donnelly said that the cost of housing was not a significant obstacle for firms based outside Dublin. "The quality of life in Limerick is much better than in Dublin," Mr Horgan said. "Housing prices are still realistic and the infrastructure isn't under so much stress."

However, Mr McDonnell said the cost of housing had become "a real problem".

"We can certainly sell Ireland as a location but there is a massive infrastructural deficit." Disposable income had been sharply eroded by housing costs.

"It's not just the purchase of houses, but the relative expense percolates into other areas."

He suggested that targeting industry outside Dublin might be one way of making inward migration more attractive.

"For historic reasons, we have a very high level of home ownership, but for a lot of people that is going to become unrealistic."

He said it was time for planners to make affordable rented accommodation available.

The high cost of housing was also criticised at the annual conference of the Civil and Public Service Union (CPSU) in Waterford. The CPSU general secretary, Mr Blair Horan, said that the trend in house prices was forcing low and middle-income earners out of the market and threatened to "wreck the economy and social partnership".

The measures put in place as a result of the Bacon report "have done nothing to bridge the home ownership affordability gap for people on low to average earnings", he said.