The Revival of Irish Indigenous Industry 1987-1997. Quarterly Economic Commentary Special Article, April 1998

Baker, T.J. and Duffy, David and Shortall, Fergal and O'Malley, Eoin (1998) The Revival of Irish Indigenous Industry 1987-1997. Quarterly Economic Commentary Special Article, April 1998. [Working Paper]

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Abstract

From the 1960s until the mid-1980s, most of the growth of employment, output and exports in manufacturing industry in Ireland occurred in foreignowned multinational companies, while the performance of native Irish-owned or indigenous industry was relatively poor. Consequently, foreign-owned firms came to account for a large proportion of manufacturing in Ireland by 1987, with 43 per cent of manufacturing employment, 52 per cent of manufacturing gross output and 74 per cent of exports of manufactured products. In the period since 1987, the foreign-owned multinational component of industry in Ireland has continued to contribute most to Irish industrial growth, with the result that by 1995 its share of total manufacturing employment increased to 47 per cent, its share of gross output increased to 65 per cent, and its share of exports increased to 82 per cent.1 Despite this continuing increase in the relative importance of foreign-owned industry, however, a major change since about 1987 has been the fact that there has been a substantial and sustained improvement in the growth performance of Irish indigenous industry. This article aims to show that, not only has the record of Irish indigenous industry been greatly improved by comparison with its own previous experience, but its growth performance over the past decade has also been stronger than that of industrial countries generally. Thus, since about 1987, the record of Irish indigenous industry has changed from one of relatively weak growth trends by international standards to one of relatively strong growth by international standards. This article brings together and analyses information from a variety of sources to document this improvement in indigenous industry, primarily by examining trends in employment, output and exports, but with reference to some other indicators as well. This involves making some estimations to fill a few important gaps in the existing data.

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