Emerging markets in focus: Ireland (part two)
As part of a series focusing on thriving economies we investigate the opportunities offered by these locations for start-up businesses.
The second part in this series will provide an insight into Ireland’s key markets to watch, with a focus on finance, life sciences & pharmaceuticals, and sectors, which are reinforcing Ireland’s status as a leading contributor in the EU and beyond.
Continued foreign and home investment are the forces behind the financial services boom that Ireland is experiencing. As positioned in the first part of this series, the possibility of a hard Brexit places Dublin as a favoured location for European relocation; already this shift in focus from London to Dublin is noticeable, with many international organisations choosing to move from the UK to maintain an EU presence.
This impact is being felt most strongly in the finance sectors but is expected to influence the wider market in due course. Ranked as number one in Europe for ease of paying business taxes, Ireland provides a convenient hub within a commutable distance from London. Already, the influx of multi-national banking corporations has fuelled the demand for finance professionals, with institutions such as JP Morgan, Bank of America, Citi, Barclays, Citadel Securities, and Credit Suisse all announcing their intention to expand.
At home, local banking institutions continue to thrive. Hays reports that ‘the profit lines and client base of Ireland’s pillar banks are beginning to resemble levels last seen in 2008’ – a level of growth which further fuels the demand for financial management professionals.
With the financial sector booming and the outlook remaining bright, demand for sector-specialists continues to exceed existing supply. The presence of these larger organisations in Dublin further intensifies the competition for the best talent in the market, forcing PLCs and SMEs to review their employee value proposition, benefits and their approach to hiring.
James Caan CBE believes that, on top of the existing prospects in the financial service market, Ireland offers huge opportunities for business growth in the wake of Brexit.
Life sciences and pharmaceuticals
Following an extremely successful 2017, Ireland’s life sciences sector is set to experience further growth, driven by both the increased presence of global organisations and Ireland’s own maturing start-up ecosystem. Due to the strength of the industry, investors are becoming more interested in the Irish start-up scene, with industry giants such as James Caan CBE already laying down foundations for extensive investment infrastructure across multiple sectors.
Ranked 10th internationally for scientific research, Ireland has extremely high standards to uphold. Despite the increasing demand in industry, these standards remain inflexible. Coupled with the complexity of the roles in demand, the life sciences industry is struggling with skills shortages more intensely than other sectors. To overcome this obstacle, many large corporates have chosen to collaborate with universities to help them develop talent for the specific skill sets their industry needs. The government has also started to offer tailored courses to meet the growing demands of the sector.
Despite this shortage, life sciences continues to boom; with nine of the world’s top ten largest drug corporations based in the country, as well as half the country’s exports coming from the sector, the life sciences and pharmaceuticals industries have transformed Ireland’s economic landscape in the past 50 years.
Aside from the large percentage of goods exports the industry accounts for, the biopharma industry alone directly employs 28,200 individuals and has grown a reputation of “good quality, leading edge manufacturing, compliance and trustworthiness”. A recent government report revealed that it employs the same number of people indirectly, through marketing, sales, and research roles.
In fact, Ireland’s reputation as a leading life sciences and pharmaceuticals hub place it as a strong contender to host the European Medicines Agency, which, in the face of Brexit, could be relocated from London. If Ireland won the bid to host the EMA, the economy would hugely benefit, welcoming hundreds of jobs directly, and thousands as by-products of the relocation. Dublin is competing against cities such as Milan, Rome, Paris, Copenhagen, Lyon, and Strasbourg, however, with its proximity to London, its impending status as the only English-speaking country in the EU, and its booming pharma industry, it presents a strong case to become the next host country for the EMA.
Ireland’s tech ecosystem has soared over the past couple of years. Tech companies have grown from €522million in venture capital funding in 2015 to €994million last year, almost twice as much as Berlin (€540million in 2017). Private seed funding has also doubled, from €70million in 2016 to €131million last year, as Ireland becomes a hotbed for software development.
The substantial growth of the tech market in Ireland has provided start-ups with a mature incubator market, where tech companies can ‘germinate, give birth and grow, with global ambitions in sight’ (Irish Independent).
Dublin has been branded the tech start-up centre of Europe, with global brands such as Google, Facebook, LinkedIn, Twitter and Dropbox establishing bases in the Silicon Docks of the capital. The impact of their technological capabilities is not limited to the sector, with Ireland being an attractive base for companies across all industries.
Consistent growth and a highly-skilled workforce make the Irish tech sector a strong contender to become one of Europe’s most important tech innovation hubs. Recognising this, the Irish government has invested heavily in digital transformation, to support the growing needs of the rapidly-growing modern business environment that the Irish nation has now become home to.
The third and final piece in this series will focus explicitly on the growing number of start-ups in Ireland.