Left behind: Kilkenny's economic recovery has come to an end - report

Weak labour market, lower levels of support from state agencies and lack of university driving poor economic performance

Sam Matthews

Reporter:

Sam Matthews

Email:

sam.matthews@kilkennypeople.ie

KILKENNY

The South East Economic Monitor 2018 report authors (from left to right), Mr John Casey, Dr Cormac O’Keeffe and Dr Ray Griffin.

Kilkenny's economic recovery has come to an end, and the county and wider south-east region are continuing to be left behind economically, according to a new report from the South East Economic Monitor.

The report, prepared by academics from Waterford IT, reveals that despite some signs of improvement, Kilkenny is not enjoying a fair share of the national recovery. According to one of the report’s authors, Dr Ray Griffin, 'a weak labour market, combined with lower levels of support from state agencies and the lack of a university in the region, all point to the end of the Kilkenny’s recovery'.

The report, now in its third year of publication, highlights the labour market in Kilkenny and the wider south-east as an area of concern. The disappointing findings continue a pattern from last year's report, which revealed that Kilkenny was 'in a state of relative economic decline'.

While there was an impressive decrease in the Live Register in Kilkenny (17% year-on-year decrease), there are serious concerns relating to the lack of high-quality job creation in the county.

Kilkenny continues to receive less than its fair share of IDA jobs. From 2011 to 2017, the IDA created 57,666 net jobs. Kilkenny accounted for less than 0.6% of these net additional jobs despite being home to 2.08% of the Irish population and Kilkenny currently accounts for a mere 0.37% of IDA jobs.

“Despite some positive job announcements, Kilkenny currently has less than one-fifth of the IDA jobs that one would expect based on its population and the number of IDA visits to the county decreased from 10 to 6 in 2017," says another of the report’s authors, Dr Cormac O’Keeffe.

There is also evidence of low job quality as the returns for taxes on work (PAYE, USC, and self-employed taxes) in Kilkenny are 72% of what one would expect based on population share, which means that more people in the region are paid less.

In terms of the wider region, the south-east is one of only two of the seven regions not to have reached its regional Action Plan for Jobs (APJ) target of bringing regional unemployment to within one percentage point of the State average. The SEAPJ has the ambitious aim of creating an additional 25,000 jobs by 2020, but since it was launched in Quarter Three of 2015, only 5,400 net new jobs have been added.

"What is driving the region’s poor economic performance is a structural issue related to the SE’s difficult relationship with the State. In particular, the very pronounced deficits in regional higher education capacity, acute hospital services, IDA supported employment drive ever lower job quality, and international tourism," says Dr Griffin.

The south-east remains a very attractive tourist destination, attracting 17.5% of domestic holidaymakers, but just 7.2% of international visitors. Dr Ray Griffin attributes this to 'poor marketing support from Fáilte Ireland', and weakening international access, with services suspended in Waterford Airport and ferry services being reduced in Rosslare in favour of Dublin.

Meanwhile, Enterprise Ireland supports a fair share of jobs in the region, but companies in the region are not very successful at accessing Enterprise Ireland’s competitive grants, according to John Casey, one of the report’s authors.

“The lower educational attainment in the region makes it very hard for the national enterprise agencies to properly support the south-east as their scheme and marketing is focused on graduates, and we have less of these in the south-east.”

According to John Casey: “Higher education remains one of the main reasons for the continued poor performance of the region. New census 2016 data shows that education attainment in the South East is far below the national average and is leading to a ‘demographic donut’, with a missing generation of 20-45 years now evident in the CSO returns."

The south-east has weaker human capital, driven by under-investment in higher education within the region. The report says this 'brain-drain' is likely to continue to accelerate with the recently announced Ireland2040 and technological university plans which concentrate further development of higher education in the seven universities. To stabilise the region’s population, 7,944 additional degree places are required in the region based on universal university type services.

READ THE FULL REPORT HERE

The South East Economic Monitor is a report published by the South East Network for Economic and Social Research (SENSER), an independent research initiative of two research centres in Waterford Institute of Technology- the AIB Centre for Finance and Business Research (AIB-CFBR) and Centre for Enterprise Development and Regional Economy (CEDRE).