Business Irish

Monday 19 February 2018

Graduates are the key to selling the country

Focusing on maths and science will strengthen our ability to convince multinationals that we can meet the challenges created by global economic conditions. By Siobhan Creaton

When the founders of the Irish Management Institute first gathered in the Gresham Hotel almost 60 years ago they came there with a simple vision. They wanted to create a new body that would improve the standard of management in Ireland and the IMI's current chief executive, Dr Tom McCarthy, says this is still fundamentally its mission.

McCarthy, who is an economist, likes to search for solutions and is optimistic that if Ireland adopts some simple management principles such as returning to doing the things that created full employment here and has attracted huge investment from multinational companies, our financial health and prospects can improve within a few years.

"We have a few levers" he says. "We need to stick to what we have always been good at and that is investing in people." The key to Ireland's economic success that was the envy of the rest of Europe, he claims, was largely down to the training and re-skilling of our workforce which occurred throughout the depressed 1980s.

"We got money from the Economic and Social Fund to train arts graduates to work in the IT and finance sectors and this proved to be a huge draw for US investment. So in the 1990s we had swathes of people who were readily employable and willing to work for a competitive wage," McCarthy says.

The age profile here is different now, having moved from a huge young population to having a "bulge" in the number of people who are over 30.

They, as McCarthy says, are "not a flight risk" and are not as likely as the young graduates to move abroad for new work opportunities. "The question is what can we do for them to improve their skills and make them more attractive to employers?"

He has gone to the Central Statistics Office to find out how many people between the ages of 24 to 55 are unemployed and looked at their education and skills.

There are 100,000 people without jobs who are aged between 14 and 34, he says, and that includes 14,000 who have honours degrees or higher. When you broaden this out to include those who are searching for jobs up to the age of 55, 40,000 of them have degrees.

"That is the challenge" he suggests. "We have very skilled people here and perhaps those skills are not needed by the economy today or maybe in the future but these people are all part of Ireland's solution to its problems and yet we don't seem to be making a big issue of it".

McCarthy acknowledges the Government initiatives to retrain the thousands who have lost their jobs in the construction sector since the bubble burst but says these skills will not be sufficient to attract new multinational investment into Ireland.

It's the graduates, he claims that will be at the frontline in terms of selling the country as an attractive location for big international companies and for Irish companies. And once they come this will create jobs and opportunities for those with different skills.

"The graduates will determine whether we will get a growth dividend over the next few years and this will benefit everyone," McCarthy says.

He has been putting forward these and other ideas to the Government in various guises. Outside of the IMI he is a board member of Forfás, the body advising on government policies to support enterprise, trade, science, technology and innovation in Ireland. He is also on the Council of the Statistical & Social Inquiry Society of Ireland.

The ongoing debate about how well people leaving education in Ireland are trained to use maths, he says, is something that comes up fairly frequently, and unprompted, in discussions with international companies who are weighing up whether to establish hi-tech and other operations here.

"Maths and science are a genuine problem here that is raised constantly by international and Irish firms and we do need to address it," he says. "We need to be radical and start experimenting with ways to teach people how to use maths.

"We don't need them to be mathematicians, it's just about knowing how to apply maths to work situations." And again, McCarthy has a solution.

"The best people to teach maths are engineers because they love maths and use the subject, so we should be using them," he says. "Every local authority employs engineers, so maybe we should look at initiatives to give them time to send them into the local secondary schools to help."

The fact that maths keeps being mentioned by potential investors doesn't mean it is the main factor that will persuade them to set up here, but as Ireland vies with more and more countries for the same projects it could become a bigger issue in the future, he says.

"It becomes important when a decision to come to Ireland is marginal" -- where there is little to separate this country with another in terms of what it can offer.

"We have been extremely successful in attracting hi-tech companies and gaming companies but if there is a perception that Ireland doesn't do maths well, that could be a problem," he warns.

McCarthy says there are lessons to be learned in reviewing what has happened in Ireland, and the role played by senior Irish business executives who sat on the boards of the failed big banks that could end up costing the taxpayer €50bn.

The first big mistake the banks made, in terms of selecting who should sit in their boardrooms, was to assume that just because someone had done well in another business that they would understand banking, he says.

"You shouldn't assume that someone who has been financially successful in one aspect has a pot of knowledge that is transferable," he says.

"There was a lack of respect for industry knowledge. There is a lot to be said for understanding the business you are in, its weaknesses and potential, to realise what is credible and what is not".

We have good examples in Ireland of companies that managed to stay grounded and are not only still standing, but thriving while the banks have bankrupted the country. "When you look at Kerry and Glanbia you get a sense that people know the sector they are in. Ireland has created two of the world's leading multinationals here."

McCarthy believes Irish people shouldn't beat themselves up too much about what went wrong and should focus on what we did achieve, and can achieve again.

"If someone told me in the 1980s when I returned to Ireland from Canada, and when unemployment was at 18pc, that between 1990 and 2006 the number of people working here would double, I wouldn't have believed it. That was an astonishing achievement" he says. The challenge is to do it again.

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