A recent Central Bank publication, Employment Growth: Where Do We Go From Here?, written by Stephen Byrne and Tara McIndoe-Calder, suggests that strong net inward migration will be the most important source of employment growth – if the economy continues to grow at the rates seen over the last number of years.
Since early 2014, the Irish economy has seen particularly strong growth in employment. As a result, the unemployment rate, which stood at 16 per cent just seven years ago, fell to 5 per cent in the first quarter of this year.
The labour force participation rate is at 62.5 per cent, similar to levels last seen in the early 2000s. Net inward migration, which was a major feature of the Irish labour market in the period from 2004 to 2007, increased to 34,000 in 2018, the third consecutive year of “strong gains”.
The study’s authors suggest that if the economy is to sustain employment growth in the short- to medium-term, without generating wage and price pressures, increases in net inward migration will be needed. If not, future growth may be impeded by labour supply constraints.
Of course, even since the report’s publication, fears have intensified in relation to the impact of Brexit. In the event of a no-deal Brexit, immediate job losses in industries such as tourism and fisheries have already been predicted.
On the other hand, efforts by Enterprise Ireland to support companies in their bid to innovate, improve competitiveness and diversify their markets are designed to help mitigate the risk for all sectors impacted by Brexit. There is even some glimmer of hope that pockets of new opportunity may open up, given Ireland's position as the EU's only English-speaking country and the fact it already hosts the EMEA headquarters of so many multinational companies.
Celtic tiger inward migration was boosted by the once-off effect of EU enlargement – today, by contrast, Ireland is competing for migrants with other European countries facing similarly tight domestic labour markets.
If Ireland is to compete in a post-Brexit world, in which trade with its major trading partner has been made more difficult, the need to attract migrants with languages here will be greater than ever.
More than just languages
Typically, the non-Irish migrants who come here bring more than just languages. According to the Central Bank report, they are increasingly highly skilled, with the majority holding third-level qualifications.
As Ireland competes for migrant labour, job flows from abroad are increasingly originating from outside of the EU, it says. Changes in the visa regime for non-EU citizens facilitate that, making it it easier to allow non-EU migrants in areas of particular skill shortages, including the Critical Skills Employment Permit, introduced in 2014.
Notwithstanding that, visa requirements for non-EU citizens are onerous, it says.
With recent CSO figures showing the number of Irish people emigrating from Ireland has overtaken the number of Irish people coming back, the need for inward migration is intensifying.
Brexit may increase the number of Irish people returning from the UK, according to Dr Johanne Devlin Trew of Ulster University and author of a number of books on migration, who also points to the rise in passport applications from UK residents.
But the Irish diaspora remains an untapped talent pool, particularly as it extends beyond those with Irish family links to what she terms the “affinity diaspora”.
“These are people who are, traditionally, non-Irish nationals who have come to Ireland to work, possibly for a multinational company, or who studied here, and who go back with, hopefully, a positive connection to Ireland,” says Devlin Trew.
Wherever such connections exist around the world, trade typically follows, she points out.
We are also seeing a rise in the reverse diaspora – the children of non- Irish nationals who were born here and possibly schooled here, returned home and come of age. They too can play a very significant part of Ireland’s diaspora story, as a resource for industry, development and trade. “That’s not just economic trade either, it is about skills and about social and cultural capital too,” she says.
