Business lobby group Ibec yesterday launched a 10-point plan aimed at improving the outlook for Irish manufacturing.
Speaking after the group's annual human resources conference, director Brendan McGinty said that unless something is done urgently to address the job losses and increasing lack of competitiveness in the Irish manufacturing sector, the entire economy would suffer.
"The manufacturing sector has contributed a very large amount of growth to the Celtic Tiger boom and if the sector continues to suffer we are simply going to see less resources made available,less wealth in the economy and less money for Government to offer for the services we would all like to see," he said.
The Irish manufacturing industry has been suffering from a loss of competitiveness over the past few years, a fact which is borne out in the employment statistics.
The sector has lost 33,400 jobs over the past four years, during which time the public sector has recruited an additional 73,800.
Amongst other things, Ibec is calling for moderate increases in pay that do not exceed those being applied by trading partners.
Currently the average cost per employee in Ireland is €38,140, significantly ahead of the euro zone average of €35,158, making the Republic an expensive place to do business.
The employers' group is also suggesting the adoption of special measures for businesses at greatest risk; encouragement for firms to invest in research and development; and more input from Government to tackle infrastructure problems.
While acknowledging that some changes need to be made to the existing social partnership structure to provide a framework that suits all sectors, Mr McGinty said he had no doubt that the situation could be solved through partnership arrangements.
"In our view, partnership has proved itself to be a robust model," he said. "It has worked well for the economy, as well as for workers and employers."
The importance of the partnership, which has been regulating Irish labour relations for the past 18 years, was also emphasised by the Taoiseach, Bertie Ahern, who told the 320 gathered delegates that while social partnership was not a recipe for perfection, it had delivered far more than could have been achieved through confrontation and conflict.
Mr Ahern said it was important not to hang on to old ideas just because they worked in the past and that it was now time to adopt change to unlock the potential of all workers and employers.
Meanwhile, the rest of the conference focused on change and the role workers could play in adopting change to maintain a prosperous economy. The problems in the manufacturing sector have been attributed in part to the industry's failure to adopt change effectively.
1) Moderate pay increases that don't exceed those of our trading partners
2) Creation of a special training fund to support up-skilling of workers
3) Financial support for HR innovation to encourage more efficient change management
4) Support from trade unions to facilitate efficient and speedy change within companies
5) The provision of help and financial advice, particularly in currency hedging, for companies that are considered to be most at risk
6) Greater links between multinational corporations and indigenous manufacturers to support innovation, research and marketing
7) The switch to volume-based R&D tax credit to encourage process engineering
8) Improvements in the quality, efficiency and value for money of public services and the introduction of a waiver on local charges during periods when there are trading difficulties
9) Encouragement for greater competition in sheltered sectors of the economy to reduce inflation and reining in business costs, in particular energy, waste disposal and commercial property rates
10) Mobilisation of Government resources for priority areas such as roads, communications, public transport and waste management
Source: Ibec
