Downturn In Irish IT Sector Could Force Review Of Work Permit Policy

by Amanda Banks, Tax-News.com, London

13 August 2001

According to reports from the Irish media, Tanaiste Mary Harney is considering reviewing Ireland's work permit policy after Gateway shut down its Dublin-based computer assembly plant last week.

Gateway's decision has been perceived by many as symptomatic of Ireland's recent downturn in the IT sector which has incurred over 4,000 job losses so far this year - now including 900 ex-Gateway employees.

The Irish Times has revealed that almost 21,000 foreign nationals have been awarded work permits in the first eight months of this year compared to 18,061 for the whole of last year.

It is estimated that over half of the permits granted are for workers in the IT industry but a review of the work permit policy, which Mary Harney will implement if the demand for work permits continues to rise, would significantly reduce this number. A government spokesman said the situation was being monitored.

To date there are constant demands for work permits at a rate in excess of 700 a week and there are no indications that this will slow down. Foreign nationals intending to work within the IT sector have been issued with 6,835 visas this year compared to 4,521 in the catering industry and 4,425 in the agriculture and fisheries industry.

Austin Hughes of the IIB Bank has warned that the Irish economy is inextricably linked to global economic conditions and could be facing a 'difficult period' for at least six to twelve months. He told the Irish News: 'We need to be careful in going forward. In broad terms, the Irish economy is vulnerable to the slowdown in the global economy. We still have a very strong economy here underneath it, we have a very skilled labour force, and we have an attractive tax environment, but we're not immune to the downturn.'

Meanwhile, Workers' Party spokesman Sean O' Cionnaith has claimed that the Gateway closure announcement should 'set alarm bells ringing loudly' for Mary Harney and her department. He said: 'The government's employment strategy is now in tatters as job losses in the hi-tech sector, in which the Tanaiste and her government have shown blind confidence, have begun to plummet because of the US recession. It is clear that the jobs policy of this government is a house of cards which is shaking at its foundations.'

'These latest closure announcements,' he added, 'also bring into sharp focus the importance of the state and semi-state sector which has been a reliable provider of jobs in good times and bad. It is now time to call a halt to the sell-off of the state companies because their new owners will have no loyalty to this country or to Irish workers.'

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