Engineers directly contribute €5.5bn to Irish economy

9 Feb 2009

Engineers directly contribute €5.5bn to the Irish economy, and are particularly prominent in high-tech sectors that account for almost 80pc of merchandise exports, a major report has found.

The findings marked the beginning today of Engineers Week 2009, which runs until Friday, 13 February.

The report found that engineers represent 2.3pc of the workforce on the island of Ireland, with the €5.5bn contribution representing 3.4pc of total Gross Value Added (equivalent to GDP) in the Republic of Ireland, and €2.1bn or 6.7pc of total GVA in Northern Ireland.

Engineers are particularly well-represented in the high-tech industrial sectors (chemical, pharmaceutical, healthcare, electronics, ICT).

In the Republic, these sectors account for almost 80pc of merchandise exports, 40pc of industrial employment, and between themselves and their suppliers account for approximately 40pc of industrial output. They generated GVA of €42.3bn in the Republic in 2007 and 25pc of total GVA for the entire economy.

Speaking at the launch of the report, which was commissioned by Engineers Ireland and undertaken by DKM Economic Consultants, John Power, Engineers Ireland director general, said the findings showcased the crucial role played by engineers across Irish industry.

“This report underscores two critical points. The first is the huge monetary value of engineers’ activities across the Irish economy and the second is the vital ‘value-add’ areas where engineers are most prominent.

“In terms of the latter, the fact that engineers are an integral part of sectors such as pharmaceutical, chemical, healthcare, electronics and ICT crystallises a key point Engineers Ireland has been making for a while: that without a steady supply of qualified and capable engineers, Ireland risks losing out in the very sectors that are the platform for our economic recovery and future prosperity as a knowledge economy,” Power added.

“Furthermore, with DKM’s economic forecast predicting growth of between 2.5pc and 4pc in the early part of the next decade, moving towards 3pc per annum from 2015, the demand for engineers could be expected to expand at an average of 1,500 per annum in Ireland and 600 per annum in Northern Ireland between now and 2020.

“It is vital Ireland can meet this demand for engineers or the risk of a prolonged economic slump will significantly increase,” Power warned.

The Irish-owned engineering sector accounts for 17pc of exports and approximately a quarter of the payroll, employment and value-added generated by indigenous manufacturing.

The engineering sector is a major element of the Northern Irish economy, with approximately 40,000 persons engaged in 2008 in 1,780 establishments, which represents approximately 5pc of total employment in Northern Ireland.

The sector accounts for 8.1pc of total GVA in Northern Ireland. At a broader level, the sectors of the Northern Irish economy where engineers are most active generate 33pc of total employment, 45pc of payroll, 25pc of GVA and 70pc of total expenditure.

There were 68,500 professional engineers at work on the island of Ireland in 2008 (48,900 or 71pc in Ireland and 19,600 or 29pc in Northern Ireland). Employment peaked in 2006 at the height of the economic boom, when engineering professions made up 2.4pc of the total workforce on the island of Ireland.

While construction has traditionally been a dominant sector of employment for engineers, ICT/software/computers, electronics/electrical, healthcare/medical devices and pharmaceutical/chemical sectors now account for approximately 15pc of all engineers.

It was found that 50pc of engineers have worked in another industry sector previously, while 31pc of Irish CEOs have a background in engineering. In 2008, some 16pc of engineering professionals working in Ireland were foreign nationals.

 “It is clear from the findings that engineers had a significant part to play in the expansion of the economy over the past 10 years, with employment of engineers more than double the rate of the total increase in employment – 82pc compared to 36pc,” explained John Lawlor, DKM economic consultant.

“The forecasts for the next decade would suggest that the predicted levels of growth will also be fuelled by a similar significant contribution from engineers.”

By John Kennedy