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Digital Economy Report 2019

The Irish Digital and Tech Economy has mostly been centred on Dublin. Multinationals have gravitated towards Dublin and the start-up sector has had its highest concentration in the capital. A Dublin location has been a given not just for companies, but also for digital and tech jobseekers.

This, however, according to Gary Mullan, Managing Director of Prosperity Digital Recruitment, is changing: “The Dublin-centric tendency appears to be easing, and we are seeing a growing appetite from Digital and Tech companies to locate to areas outside of Dublin, and a parallel willingness from jobseekers to work in regional locations”.

The Candidate Perspective

Prosperity recently ran a survey across 150 Ireland based candidates, the majority of whom are currently living in Dublin. Candidates were surveyed on their preference regarding working In Dublin Versus working outside Of Dublin, and the results returned a clear dissatisfaction with both the cost and availability of accommodation in Dublin, and a marked openness to working in rural areas of Ireland.

74% of respondents stated that they strongly agreed / agreed that the cost of accommodation in Dublin would make them consider a job in other areas of Ireland.

A similar percentage indicated that the lack of availability of accommodation in Dublin would make them consider a job in other areas of Ireland.

82% of respondents strongly agreed / agreed that an easier commute would make them consider a job in areas of Ireland other than Dublin.

And 87% of respondents strongly agreed / agreed that an improved quality of life would make them consider a job in other areas of Ireland.

The survey returned many interesting comments; while of course the lack and cost of accommodation was frequently cited as a major issue for many people, with one respondent stating: I don’t like the idea of sharing a house with ten other people just to make ends meet! - the time and stress devoted to commuting and the cost of childcare in Dublin are also considered to be the major drawbacks of city living for many of the respondents.

Several respondents stated that they are currently working remotely for Dublin based companies; these tended to be mostly tech candidates. While other highly sought-after candidates stated that they would only make a long-term commitment to a Dublin based company if they would be allowed to work remotely.

There were some reservations expressed about the drawbacks of working outside of Dublin. Quite a few candidates place a high value on the buzz and weekend life they enjoy in Dublin; and there were also quite a few candidates who expressed concern that their children might not have access to a choice of good schools. One respondent summed this up by saying: “I would love to live outside of Dublin for a better quality of life & higher income-expense ratio provided that I have good services in the locality (hypermarkets, schools, shopping centres & possibly an interesting community of people). The objective is not to have a negative impact on the family (I have small kids) when living out of the city; that's my priority”.

Outside Dublin: The Lay of the Land

According to a recent Society of Chartered Surveyors Ireland report, much of small-town Ireland is still reeling from the financial crisis, and the lack of high-speed broadband is implicated as a major impediment to recovery. Nevertheless, there are currently quite a few initiatives and digital hubs in development or expanding around Ireland, and these are emerging as a timely pressure valve for some of the infrastructural issues that the Dublin Digital and Tech economy is experiencing.

Gary Mullan of Prosperity met with Eamonn Sayers of the Guinness Enterprise Centre to discuss the Centre’s goal of networking 120 regional Enterprise Hubs.

According to Eamonn: “The goal is to provide shared resources, consultancy and guidelines on best practice and also to allow start-ups to use the Guinness Enterprise Coworking space, while Dublin firms can base themselves in connected hubs throughout the country”.

Eamonn goes on to add that The Guinness Enterprise Centre has also partnered with many of the leading universities around the world to provide a resource of graduate expertise which the hubs will be ultimately able to tap into.

The creation and growth of regional enterprise hubs tends to be based on a massive amount of resources, effort and goodwill. There are many instances of business people who have left a region and who have decided to invest back into the community. Whereas the Prosper Group takes a more coordinated approach, consisting of 350 business people who meet 3 times a year to assess and work with local business and help them to grow.

The Ludgate Digital Hub in Skibbereen is an excellent example of what the initiative and hard work of local participants and business mentors can achieve. Ludgate has a board of 13 all working on a pro bono basis and is cited as an example of innovation succeeding in rural Ireland and is indeed a striking blue print for other rural areas. To date significant private investment has been obtained to construct Ludgate, and the hub’s goal is to attract 75 people to work in a creative workspace with an aim to eventually generate 500 direct jobs and 1000 indirect jobs.

Another example of a new and exciting Digital Hub that successfully proves it is possible to live and work in a remote and beautiful location is the Sneem Digital Hub. The Sneem Hub is an IDA supported project with high speed broadband and high-tech video conferencing services and is a fantastic example of an initiative aimed at rejuvenating regional economies.

Prosperity recently discussed the vison behind the Sneem Digital Hub with its founder, Padraig Burns. You can access the interview HERE.

Padraig believes that this is a fantastic opportunity both for Sneem and for workers who are hard pressed to afford urban rents and who are hopeful of a better work life balance.

Padraig makes the point that in terms of the local economic impact, 20 new jobs to Sneem is equivalent to 4000 new jobs in Cork City.

Other Digital Hubs and initiatives are based at Kells; there’s the Building Block in Sligo; Crystal Valley in Waterford and One Region One Vision in Galway

There is an initiative in Galway that is a partnership between NDRC and Galway City Innovation District called Portershed, and this represents a major part of Enterprise Ireland’s general strategy to create a sustainable start-up ecosystem throughout Ireland.

Through a joint venture between Vodafone and the ESB, Cork City is set to have access to the most powerful broadband services of any city in Ireland. This will build on the roll out of such services to not just Skibbereen but to other Cork towns such as Carrigaline and Mallow and there are plans to extend this to Carrigtwohill, Midleton, Blarney, Tower and Charleville.

While Cork has the higher number of tech companies, Limerick has been winning the most funding for tech companies and start-ups.

Amongst the impressive rise of regional tech hubs, Limerick stands out. Limerick is developing a cluster of digital and tech hubs, including its centrally located Opera site which aims to host 3,000 jobs, many of them in Digital and Technology, and a Sportstech hub which aims to bring 500 jobs in sports research and technology.

As our Competitiveness Ranking goes South, we need to go West

There is little doubt that it is the infrastructural constraints on the Dublin Digital and Tech economy that has contributed to a slippage of six places in the 2018 IMD World Competitiveness Ranking – from a respectable sixth place to a current position of twelfth. Aspects that can affect the competitiveness score include the availability of accommodation, talent, the regulatory environment, and investment (or lack of) in infrastructure, and the cost of living.

According to Gary Mullan, “I have no doubt that the competitiveness ranking decline is down to the fact that the Digital and Tech economy is largely centred on Dublin with its excruciating lack of decent accommodation, and with that, spiralling rents. The digital economy is set to contribute €22bn to the nation’s GDP by 2020. It is a very big deal. And the Dublin accommodation crisis is a very big challenge to the Digital economy. I hear it day in and day out from clients and candidates, and I often have conversations with companies who are interested in locating to Ireland – we get a lot of calls from such companies seeking information on availability of talent and salary scales. When I follow up with these companies, they often tell me that they have been deterred by the horror stories that are circulating about accommodation in Dublin. I now tell make a point of telling such callers, go West!”