Ireland's high national productivity figures before the Covid crisis masked significant areas of underperformance in some parts of the economy, Tánaiste and Minister for Enterprise and Employment, Leo Varadkar has said.
Addressing the second day of the national economic dialogue he [said] while productivity was not a term to grab the imagination, it was “crucially important”.
He said competitiveness and productivity needed to be improved, that there should be a “pandemic-dividend” for workers , He said the Government wanted to see record numbers of people – about 2.5 million –in employment within the next two to three years.
He said not all previous jobs would return after the pandemic and also warned that “capacity constraints may emerge quickly in certain areas, especially given the scale of investment required in areas like housing and climate”.
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Mr Varadkar said that as well as helping businesses and workers through the immediate challenges facing them, the Government also had to look to the longer term.
“We need to put in place forward-looking policies that will create the right environment for an inclusive jobs-led recovery. That means helping business become more resilient and agile.”
“It means increasing Ireland’s competitiveness and productivity, placing a focus on expanding sectors, such as green and digital, life sciences, the creative industries and the health and social care economy.”
Mr Varadkar said that coming into the Covid-19 crisis, Ireland had ranked high in terms of international competitiveness and productivity. However he said "our high national productivity figures had masked significant areas of underperformance".
“There is a long-standing and, also, growing productivity gap between high-performing ‘frontier’ firms, often foreign-owned – and the rest of the economy.”
“If we want higher levels of productivity in our SME sector, we need to figure out how those companies can learn from the high performing multi-national cohort. “
Mr Varadkar said the Government wanted to restore employment numbers to pre-pandemic levels and to then go beyond this “by targeting a record 2.5 million people in work in 2024”.
He said the Government wanted “to treat workers better after the pandemic”.
“Essential workers – from doctors, nurses and gardai – to delivery riders and supermarket staff – have got us through this difficult time. And we must do more for them.”
Mr Varadkar said he would be bringing forward new legislation to introduce sick pay for almost all workers. He said the the Low Pay Commission had formally begun work on examining how Ireland can move towards a living wage.
He said a series of reforms were also being progressed “to unleash the potential of remote working, including the right to disconnect and the right to request remote working”.
“I believe these reforms can form part of a pandemic dividend – a positive legacy which can emerge from the hardship and sacrifice endured by the Irish people during the pandemic.”
