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The "IT Skills Shortage" - a Corporation Tax distortion? (2nd attempt!)


clearmurk

Well-known member
Joined
Apr 27, 2012
Messages
3,019
Another week, another report.

I’m getting tired of hearing the business development approach of recruiters and consultancies seeking honorary membership of the Skills Shortage gang.

Let’s look at this a bit closer.

The CSO Quarterly Household survey, Q3 2012, indicates that there are some 78,000 people employed in the “Information and Communication Services” sector J (page 10).

http://www.cso.ie/en/media/csoie/releasespublications/documents/labourmarket/2012/qnhs_q32012.pdf

The average job vacancy rate across the EU-17 in Q3 2012 was 1.5%. In Ireland, this figure was 0.7%.

Job vacancy statistics - Statistics Explained

However, for Q3 2012, the job vacancy rate for Information and Communication Services in Ireland is provisionally estimated at 2.1%. This implies job vacancies in the area of some 1640 roles.

Are we much different to our European partners? Take a look at this graph of job vacancy rates across many European countries.

https://docs.google.com/document/d/1hSQ5bveyx7eWdxaX9RodOSw8XCqBZviR0_nRdNpPgTw/pub

It seems that we may not be too different from many other countries in this regard, and better than several.

But, but, but, aren’t the vacancies in multi-nationals who need language skills to service their overseas markets? And here’s the rub. Corporation tax policy makes it very attractive for companies to drive as much as possible of their world-wide revenues through Ireland. And, of course, these companies are inevitably going to need people with local knowledge and language skills to facilitate these overseas operations.

So the skills shortage, such as it is, may at least in part be the expression of the multi-nationals’ need to exploit further the very attractive Corporation Tax regime. Whether the importation of people to service this need constitutes a valid domestic employment policy is uncertain at best.
 


wombat

Well-known member
Joined
Jun 16, 2007
Messages
32,323
So the skills shortage, such as it is, may at least in part be the expression of the multi-nationals’ need to exploit further the very attractive Corporation Tax regime. Whether the importation of people to service this need constitutes a valid domestic employment policy is uncertain at best.
All multinationals need to bring in workers from overseas and most of them send Irish employees to overseas plants. The only question is whether the number of foreign workers is excessive relative to the local workforce or are they being imported as cheap labour.
 

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