The true story of the threat to tech jobs is beginning to emerge. Despite a wave of job losses, the tech glass is definitely half full rather than half empty. CSO figures show that 11,000 IT and computer sector jobs were lost in the three months to the end of September.
This is much more than the public announcements made by companies like Twitter, Meta and others. It comes to around 916 jobs per week in the sector over a three-month period.
However, the bigger picture remains strong — at least for now. In September, 12,000 more people worked in the industry than in the same month last year.
This underscores the rapid rate at which people have been hired in this industry. Despite the losses, a staggering 28,500 more people were still working in the ICT industry than at the end of 2019 before the Covid virus outbreak.
Most of those who lost their jobs probably work in areas such as sales, commercial development and related fields
The danger here to the economy really depends on how you look at it. The speed at which 11,000 jobs could be eliminated is a bit alarming. On the other hand, the fact that the industry has been moving quickly means that some of the larger players may feel that they have quickly cut and dealt with their costs.
Another important factor is how these numbers relate to tech jobs, not tech jobs per se. Most of those who have lost their jobs are likely to work in fields such as sales, commercial development and related fields, as opposed to software engineering or development.
Many of these people may find a similar job, but not directly in the technology sector.
Perhaps a positive take on this is the fact that if the technology sector in Ireland had continued to grow at its previous breakneck pace, its impact on the rental and housing market would have been significant.
A lack of living space would have halted the industry’s gallop to some extent anyway
Inevitably, some of these workers would be lured to Ireland from abroad for these jobs, and the housing crisis is in turmoil. Even if tech companies hadn’t slowed down, a lack of housing would have halted the industry’s gallop to some extent anyway.
These are better paying jobs. And tech companies, in some cases, sourced rental properties for employees. But there are trickle-down effects across the rental market, where new lease rents continue to grow at an alarming rate.
Central Bank Governor Gabriel Makhlouf said the tech sector had “paused” internationally and in Ireland when it came to jobs. With greater global economic uncertainty, it’s hard to see how more jobs won’t be lost.
However, we would need to see another 28,000 job losses in ICT before we would fall back to pre-Covid employment levels.
If anything, these companies were expanding too fast, too much. The current slowdown is a small portion of reality. A little reality is good, too much harms the economy and the treasury.
Will China Factory Protest Make Apple Jags Squeak?
Scenes of riot police in the Chinese city of Zhengzhou dealing with Foxconn factory workers appear to have little to do with Ireland. However, these Foxconn workers were protesting unpaid bonuses they had been promised as they were forced to work in difficult conditions due to Covid restrictions.
As Covid case numbers hit record highs in China, more parts of the country go into lockdown. Foxconn is responsible for 70 percent of iPhone shipments worldwide. Most of them are manufactured at the Zhengzhou factory, which employs 200,000 people.
Apple sales of iPhones depend massively on what happens at this factory. Notwithstanding the work done by thousands of Apple employees in Ireland, our corporation tax revenue depends on Apple Inc.’s overall financial performance.
Apple has already warned that it expects lower-than-expected shipments of premium iPhone 14 models. Reuters has previously warned that iPhone production at the plant could fall by 30 percent in November.
The recent unrest is increasing uncertainty about the Foxconn plant’s ability to meet targets, especially against a backdrop of higher Covid cases in China with relatively low vaccine uptake.
These risks are partially priced into Foxconn’s and Apple’s stock prices. Foxconn shares had fallen 2 percent since the unrest began in October. Apple’s stock price is up over 3 percent over the past five days and over 1 percent over the past month.
The tech giant hasn’t impacted its share price the way other tech companies have. Apple shares are down just 6.7 percent over the past year and 17 percent since January.
Meta shares are down 67 percent over the past year. Shares in parent companies Google and Amazon have fallen 32 percent and 47 percent, respectively, over the past year.
The number of people involved in the Foxconn factory protests is relatively small. However, rising Covid numbers are the main backdrop to potential challenges in Apple’s supply chain.
Budgeting for the North
Northern Ireland Minister Chris Heaton-Harris has decided to push ahead with a separate budget in Stormont in the absence of a functioning assembly and government. Of course, his announcement hyped the increase in various budgets for the North while lamenting that he had to do so in the first place.
The education budget must experience significant cuts compared to its “current spending rate,” he said.
One notable figure he lists is that the budget grants 20 per cent more per capita than in other parts of the UK. Subsidies to the north remain very high and the Northern Ireland minister also lamented the £660m (€768m) plus overspending by the previous Stormont government.
Profit after tax rose to 2.8 million euros in 2020, compared with 139,000 euros in 2019. Public transport fares are expected to rise and the new austerity measures in London under Jeremy Hunt may well come to Northern Ireland.
The reality is that the North has a unique opportunity to advance its economy due to the unique position it holds in the UK and EU markets as a result of the Protocol. This is about future foreign direct investments.
I recently spoke to an international executive who is planning to make a major equity investment in the North. He said labor costs are 20 percent lower than across the water and 40 percent lower than across the street to the south.
Clare company PSA payout
An Ennis-based company that received €102 million in orders from the HSE for PPE equipment at the start of the pandemic paid out almost €4 million in dividends to shareholders last year. EKO Integrated Services had contacts in China that helped it source large quantities of healthcare PPE early in the pandemic.
Profit after tax increased to €2.8 million in 2020 compared to €139,000 in 2019. Accounts for 2021 show that retained earnings increased after paying a dividend of €3.28 million to shareholders at 1 €.2 million have fallen.
EKO is owned by a limited liability company called Reginald Investments, which in turn is owned by a private partnership.
As a secondary supplier, most of the money the HSE paid would ultimately go to the PPE manufacturer in China.
https://www.independent.ie/business/irish/more-than-11000-tech-jobs-have-vanished-in-just-three-months-but-its-not-all-bad-news-42175681.html More than 11,000 tech jobs have disappeared in just three months — but that’s not all bad news