Towns feel pain as jobs vanish...
Ireland's towns, once noisy with the sounds of construction, are ominously quiet, as people get to grips with a new reality and the prospect of emigration, writes Ronan McGreevy .
A WEEK AFTER Leitrim were knocked out of the Connacht championship by Galway, the county captain, Gary McCloskey, emigrated to London.
McCloskey, who was Leitrim player of the year in 2007, had been out of work for five weeks, having been made redundant by Shine Construction, based in Athlone.
Shine, which had been involved in several projects in the midlands including the development of Athlone town's new stadium, blamed the downturn in the building sector for its closure in May. The firm had debts of €3.5 million and assets of just €990,000. Twenty others lost their jobs.
"I had no work for five weeks," says McCloskey, a Trinity College graduate in civil engineering. "It came to a crunch and that's it - hop on a plane to London. It was easy, given the circumstances - money going out, nothing coming in. I did three interviews and there was nothing happening really. There were so many lads going for the same jobs.
"The lads from the County Board were looking out for things, but I knew myself it wouldn't be easy finding a job trying to sort me out, even with connections."
McCloskey has since been joined by his brother Mark, a bricklayer. "He was getting a few weeks here and there and getting laid off and he just said he had enough. He wanted full-time employment." The County Board has since found Gary McCloskey a job, but it was not what he wanted. He had already signed a contact with a construction firm in the UK and has transferred GAA clubs.
"I'll stick it out here for a while. I'll keep looking out for something at home but, from now until next spring, there won't be much happening," he says.
"You could see it happening just after the Christmas with a lot of lads coming down on the site looking for work. It's a nationwide problem. I'd say with the builders' holidays coming up, you'll find a lot more fellows heading to London."
The emigration of a county footballer is a stark reminder of how things have changed with a suddenness which has left many wondering if we are returning to the bad days of mass emigration and unemployment. Officially, standardised unemployment, according to the Central Statistics Office, is 5.7 per cent. That figure is based on the Quarterly National Household Survey, where individuals are asked about their employment status. The last one was carried out at the end of February. It is then adjusted to take account of seasonal factors and the rise in the Live Register.
The number on the Live Register was 220,811 in June, up 54,448 on June 2007, an increase of nearly a third. Strictly speaking, the Live Register does not measure unemployment because it includes those who are part-time or casual. However, it does include all those who want to work full-time but cannot.
SIPTU BELIEVES THE official unemployment rate underestimates the extent of the problem. A more accurate representation, it believes, is to count those who are signing on now as a percentage of the overall labour force. According to those figures, 13.5 per cent of the workforce in the border counties of Donegal, Cavan, Monaghan, Louth, Sligo and Leitrim are signing on, while more than one in eight workers in the midlands counties of Laois, Offaly, Westmeath and Longford (12.66 per cent) and the south-east counties of Carlow, Wexford, Waterford, Kilkenny, Tipperary North Riding and Carlow (12.65 per cent) are also on the Live Register.
The nationwide picture suggests that 9 per cent of the workforce is currently signing on, with only Dublin, the south-west (Cork and Kerry) and the mid-east (Kildare, Meath and Wicklow) at or below the national average. Even in the commuter counties there is a significant problem, according to Labour TD and chairman of the Oireachtas committee on Enterprise, Trade and Employment Willie Penrose. Over the last fortnight, the committee's members have been visiting Dublin commuter towns. These were the engine of the Celtic Tiger, the homes of a new generation of prosperous commuters, and of those pushed out of Dublin by high house prices. It is also the spiritual home of Breakfast Roll Man, whizzing up and down the M7 from one construction job to another.
Several of the towns visited report double digit percentage figures for those on the Live Register. The problem is worst in Drogheda, a town with traditionally high levels of unemployment, where the number on the live register reached exactly 4,000 last month or an estimated 22 per cent of the workforce. The committe heard that the equivalent figure for Athy was 16 per cent, for Carlow 15 per cent and for Navan 10 per cent.
In the prosperous seaside town of Balbriggan there are more people on the live register (1,923) than there are in Ballymun (1,721), representing between 12 and 16 per cent of the workforce, although the figures there may be skewed by the amount of social and affordable housing that has been built in recent years.
"It was hair-raising, a great shock, to see these figures in context after a period of unprecedented growth in the economy," says Penrose. "We were taken aback by the level of recorded unemployment."
The new Mayor of Drogheda, Cllr Frank Maher, said the recent loss of 250 Coca-Cola jobs at its concentrate factory in the town is only part of the story.
"The unspoken problem, and the one that does not register on the radar, is the number of small- to medium-size businesses that are laying people off in small numbers but are contributing to the larger figure," he says. "A lot of small businesses are under severe pressure, from IT across to the services sector. Costs are increasing, shops and supermarkets are all tightening. Shops are not taking on seasonal workers. At the moment they are contracting - anybody who wants to go is being let go."
The problem is as bad if not worse in other parts of the country. In Roscommon, Castlerea councillor Luke Flanagan says the housing tax incentives have fuelled a construction boom in many towns in the midlands and the west of Ireland which has left a legacy of locals priced out of the market, empty houses, panicking investors who cannot find tenants and a goldrush cycle of boom and bust.
"My father has just retired as a carpenter and my brother as a blocklayer and they have thrived to a certain extent on the boom, but now that it is gone, it is not worth a damn to any of us," he says. "It was the most predictable thing at the end of the day. Building houses is not really an industry. As my father says to me, you can't export those houses to China and make money out of them.
"All you have to do is go to a pub-cafe in the town called Carthy's. If you went there up to a year ago, the place was packed out with breakfast roll men. That place ain't packed out anymore."
IN TRUE WEST-OF-IRELAND fashion, many local tradesmen have emigrated, says Flanagan. Some have gone to the UK, others to the US and Australia.
"Our unemployment rate has gone from 500 to more than 900 in the last year-and-a-half. Anecdotally, that figure would have gone up higher if people had not left," he says.
The economic downturn is rotten luck for school-leavers, who have no memory of how bad things once were in Ireland and have grown up in a time of plenty. The number of apprenticeships so far this year is half of what it was in 2006.
"These things happen from time to time. I'd like not to be totally pessimistic for young people," says Tony Power, director of apprenticeships at Fás. "We've got to ensure those who are in the apprenticeship programme can finish their training and get qualified. I wouldn't like to give the impression that we are preparing people for emigration.
"Some people will, by choice, maybe take that option and we have to facilitate them as best we can. There is mobility of labour and mobility of apprenticeship and people make different choices."
The problem is not confined to the regions. Though Dublin, because of its diversified economy, has escaped the worst to date, there are significant problems in the construction industry. Last month, electrical contractor Elenco, based in Santry, closed its doors with the loss of 140 employees, leaving dozens of electricians on the dole queue. Elenco was founded in 1971 and survived the slump of the 1980s, but could not survive changes to Government tendering for projects such as schools and hospitals, along with a chronic cash flow problem.
"Basically, big builders are not paying out because they are not selling," says Tim (31), an electrician who has worked with Elenco since leaving school and did not want to give his full name. "The company was chasing money for months but it was never enough. I can't see any of us getting full-time work anytime soon. Builders are cutting back. They don't have enough work for the staff they have. For the time being at least, we're snookered."
Willie Penrose believes the current economic slump is a direct result of the folly of depending on an industry as transient as construction. "It will be the SMEs (small and medium enterprises) that will get us out of this mess," he says.
The committee found many disparate problems in the towns it visited, but one theme was clear: there was not enough support for start-up businesses, and the County Enterprise Boards (CEBs) are so chronically under-funded that many have run out of funds already this year.
"There is significant scope to increase the funding of the County Enterprise Boards. These fund start-up enterprises with 10 employees or less and they are what I'd call acorn businesses. There is nothing Flash Harry about them," Penrose says. "Anywhere we have gone, there are people trying to start these type of businesses up and they are not getting the support they need. Regulations are seen as a major impediment or inhibiting factor."
OTHER FACTORS LIKELY to be identified as critical when the committee reports in October are the need for a skills analysis in individual towns to match up skilled workers with prospective employers, and better co-ordination between all the state agencies involved in employment generation - the IDA, Enterprise Ireland, County Enterprise boards and local authorities.
"It has come across to us that local authorities are significant engines of growth because of the land banks they are sitting on," Penrose explains.
The scale of redundancies is putting serious pressure on Fás. In the midlands region, which consists of counties Laois, Offaly, Westmeath, Kildare and Longford, the number of redundancies among firms notified to the agency has risen dramatically from 34 two years ago to 821 already this year.
Fás midlands director Róisín Doherty says there has been a step change in the perception of what it means to be made redundant among the unemployed and in society in general from the 1980s. Crucially, employees are treating redundancy as a new beginning, not a finall end.
"People are saying to us, 'just give me another job'. We undertook a retraining programme with people who lost their jobs in Athlone and could not get something in their chosen field," says Doherty. "There is very much an attitude of let's get me computers, let's get me retraining as opposed to having to drag people to get them motivated.
"We said to them, 'Look, while you are waiting on your ideal job, why don't you retrain in those areas. Why not, if you are a forklift driver, upskill in that area and become certified?' If people aren't progressing or are not being retrained, they will be sitting at home. The big thing for people is that they used to be out there earning a guaranteed salary and they don't have that now. That's why we are saying to people that they should come in and do a course in any case."
Tom Parlon, director-general of the Construction Industry Federation (CIF), acknowledges there are problems in the housebuilding sector, but says there are major projects such as Lansdowne Road, the new Mater Hospital, the Corrib Gas Refinery and the National Concert Hall which will take up some of the slack.
He says the construction boom was unsustainable and so were the wages being paid to staff. The CIF are looking for the entry level wage to be cut from €14.88 an hour, which represents 80 per cent of the skilled rate, to a figure closer to 60 per cent.
"The big issue is that it is beginning to dawn on people that construction spreads so wide," says Parlon. "People were cynical that developers were doing very well, but on the other hand they were generating massive employment. Houses became too expensive, but so too did costs. The pay rates in construction were out of all proportion with anything else."
Flanagan believes that the absence of long-term industry in towns such as Castlerea means that a return to mass emigration and depopulation cannot be ruled out, now that the construction boom is over.
"In business there are makers, takers and fakers," he says. "Can anyone point out to me new bit of business in the area that was not here in the 1980s, the businesses that generate the wealth and pay the wages? Only a naive fool would rule out a return to the bad old days."
Report by RONAN McGREEVY for Irish Times Newspaper
Ireland's towns, once noisy with the sounds of construction, are ominously quiet, as people get to grips with a new reality and the prospect of emigration, writes Ronan McGreevy .
A WEEK AFTER Leitrim were knocked out of the Connacht championship by Galway, the county captain, Gary McCloskey, emigrated to London.
McCloskey, who was Leitrim player of the year in 2007, had been out of work for five weeks, having been made redundant by Shine Construction, based in Athlone.
Shine, which had been involved in several projects in the midlands including the development of Athlone town's new stadium, blamed the downturn in the building sector for its closure in May. The firm had debts of €3.5 million and assets of just €990,000. Twenty others lost their jobs.
"I had no work for five weeks," says McCloskey, a Trinity College graduate in civil engineering. "It came to a crunch and that's it - hop on a plane to London. It was easy, given the circumstances - money going out, nothing coming in. I did three interviews and there was nothing happening really. There were so many lads going for the same jobs.
"The lads from the County Board were looking out for things, but I knew myself it wouldn't be easy finding a job trying to sort me out, even with connections."
McCloskey has since been joined by his brother Mark, a bricklayer. "He was getting a few weeks here and there and getting laid off and he just said he had enough. He wanted full-time employment." The County Board has since found Gary McCloskey a job, but it was not what he wanted. He had already signed a contact with a construction firm in the UK and has transferred GAA clubs.
"I'll stick it out here for a while. I'll keep looking out for something at home but, from now until next spring, there won't be much happening," he says.
"You could see it happening just after the Christmas with a lot of lads coming down on the site looking for work. It's a nationwide problem. I'd say with the builders' holidays coming up, you'll find a lot more fellows heading to London."
The emigration of a county footballer is a stark reminder of how things have changed with a suddenness which has left many wondering if we are returning to the bad days of mass emigration and unemployment. Officially, standardised unemployment, according to the Central Statistics Office, is 5.7 per cent. That figure is based on the Quarterly National Household Survey, where individuals are asked about their employment status. The last one was carried out at the end of February. It is then adjusted to take account of seasonal factors and the rise in the Live Register.
The number on the Live Register was 220,811 in June, up 54,448 on June 2007, an increase of nearly a third. Strictly speaking, the Live Register does not measure unemployment because it includes those who are part-time or casual. However, it does include all those who want to work full-time but cannot.
SIPTU BELIEVES THE official unemployment rate underestimates the extent of the problem. A more accurate representation, it believes, is to count those who are signing on now as a percentage of the overall labour force. According to those figures, 13.5 per cent of the workforce in the border counties of Donegal, Cavan, Monaghan, Louth, Sligo and Leitrim are signing on, while more than one in eight workers in the midlands counties of Laois, Offaly, Westmeath and Longford (12.66 per cent) and the south-east counties of Carlow, Wexford, Waterford, Kilkenny, Tipperary North Riding and Carlow (12.65 per cent) are also on the Live Register.
The nationwide picture suggests that 9 per cent of the workforce is currently signing on, with only Dublin, the south-west (Cork and Kerry) and the mid-east (Kildare, Meath and Wicklow) at or below the national average. Even in the commuter counties there is a significant problem, according to Labour TD and chairman of the Oireachtas committee on Enterprise, Trade and Employment Willie Penrose. Over the last fortnight, the committee's members have been visiting Dublin commuter towns. These were the engine of the Celtic Tiger, the homes of a new generation of prosperous commuters, and of those pushed out of Dublin by high house prices. It is also the spiritual home of Breakfast Roll Man, whizzing up and down the M7 from one construction job to another.
Several of the towns visited report double digit percentage figures for those on the Live Register. The problem is worst in Drogheda, a town with traditionally high levels of unemployment, where the number on the live register reached exactly 4,000 last month or an estimated 22 per cent of the workforce. The committe heard that the equivalent figure for Athy was 16 per cent, for Carlow 15 per cent and for Navan 10 per cent.
In the prosperous seaside town of Balbriggan there are more people on the live register (1,923) than there are in Ballymun (1,721), representing between 12 and 16 per cent of the workforce, although the figures there may be skewed by the amount of social and affordable housing that has been built in recent years.
"It was hair-raising, a great shock, to see these figures in context after a period of unprecedented growth in the economy," says Penrose. "We were taken aback by the level of recorded unemployment."
The new Mayor of Drogheda, Cllr Frank Maher, said the recent loss of 250 Coca-Cola jobs at its concentrate factory in the town is only part of the story.
"The unspoken problem, and the one that does not register on the radar, is the number of small- to medium-size businesses that are laying people off in small numbers but are contributing to the larger figure," he says. "A lot of small businesses are under severe pressure, from IT across to the services sector. Costs are increasing, shops and supermarkets are all tightening. Shops are not taking on seasonal workers. At the moment they are contracting - anybody who wants to go is being let go."
The problem is as bad if not worse in other parts of the country. In Roscommon, Castlerea councillor Luke Flanagan says the housing tax incentives have fuelled a construction boom in many towns in the midlands and the west of Ireland which has left a legacy of locals priced out of the market, empty houses, panicking investors who cannot find tenants and a goldrush cycle of boom and bust.
"My father has just retired as a carpenter and my brother as a blocklayer and they have thrived to a certain extent on the boom, but now that it is gone, it is not worth a damn to any of us," he says. "It was the most predictable thing at the end of the day. Building houses is not really an industry. As my father says to me, you can't export those houses to China and make money out of them.
"All you have to do is go to a pub-cafe in the town called Carthy's. If you went there up to a year ago, the place was packed out with breakfast roll men. That place ain't packed out anymore."
IN TRUE WEST-OF-IRELAND fashion, many local tradesmen have emigrated, says Flanagan. Some have gone to the UK, others to the US and Australia.
"Our unemployment rate has gone from 500 to more than 900 in the last year-and-a-half. Anecdotally, that figure would have gone up higher if people had not left," he says.
The economic downturn is rotten luck for school-leavers, who have no memory of how bad things once were in Ireland and have grown up in a time of plenty. The number of apprenticeships so far this year is half of what it was in 2006.
"These things happen from time to time. I'd like not to be totally pessimistic for young people," says Tony Power, director of apprenticeships at Fás. "We've got to ensure those who are in the apprenticeship programme can finish their training and get qualified. I wouldn't like to give the impression that we are preparing people for emigration.
"Some people will, by choice, maybe take that option and we have to facilitate them as best we can. There is mobility of labour and mobility of apprenticeship and people make different choices."
The problem is not confined to the regions. Though Dublin, because of its diversified economy, has escaped the worst to date, there are significant problems in the construction industry. Last month, electrical contractor Elenco, based in Santry, closed its doors with the loss of 140 employees, leaving dozens of electricians on the dole queue. Elenco was founded in 1971 and survived the slump of the 1980s, but could not survive changes to Government tendering for projects such as schools and hospitals, along with a chronic cash flow problem.
"Basically, big builders are not paying out because they are not selling," says Tim (31), an electrician who has worked with Elenco since leaving school and did not want to give his full name. "The company was chasing money for months but it was never enough. I can't see any of us getting full-time work anytime soon. Builders are cutting back. They don't have enough work for the staff they have. For the time being at least, we're snookered."
Willie Penrose believes the current economic slump is a direct result of the folly of depending on an industry as transient as construction. "It will be the SMEs (small and medium enterprises) that will get us out of this mess," he says.
The committee found many disparate problems in the towns it visited, but one theme was clear: there was not enough support for start-up businesses, and the County Enterprise Boards (CEBs) are so chronically under-funded that many have run out of funds already this year.
"There is significant scope to increase the funding of the County Enterprise Boards. These fund start-up enterprises with 10 employees or less and they are what I'd call acorn businesses. There is nothing Flash Harry about them," Penrose says. "Anywhere we have gone, there are people trying to start these type of businesses up and they are not getting the support they need. Regulations are seen as a major impediment or inhibiting factor."
OTHER FACTORS LIKELY to be identified as critical when the committee reports in October are the need for a skills analysis in individual towns to match up skilled workers with prospective employers, and better co-ordination between all the state agencies involved in employment generation - the IDA, Enterprise Ireland, County Enterprise boards and local authorities.
"It has come across to us that local authorities are significant engines of growth because of the land banks they are sitting on," Penrose explains.
The scale of redundancies is putting serious pressure on Fás. In the midlands region, which consists of counties Laois, Offaly, Westmeath, Kildare and Longford, the number of redundancies among firms notified to the agency has risen dramatically from 34 two years ago to 821 already this year.
Fás midlands director Róisín Doherty says there has been a step change in the perception of what it means to be made redundant among the unemployed and in society in general from the 1980s. Crucially, employees are treating redundancy as a new beginning, not a finall end.
"People are saying to us, 'just give me another job'. We undertook a retraining programme with people who lost their jobs in Athlone and could not get something in their chosen field," says Doherty. "There is very much an attitude of let's get me computers, let's get me retraining as opposed to having to drag people to get them motivated.
"We said to them, 'Look, while you are waiting on your ideal job, why don't you retrain in those areas. Why not, if you are a forklift driver, upskill in that area and become certified?' If people aren't progressing or are not being retrained, they will be sitting at home. The big thing for people is that they used to be out there earning a guaranteed salary and they don't have that now. That's why we are saying to people that they should come in and do a course in any case."
Tom Parlon, director-general of the Construction Industry Federation (CIF), acknowledges there are problems in the housebuilding sector, but says there are major projects such as Lansdowne Road, the new Mater Hospital, the Corrib Gas Refinery and the National Concert Hall which will take up some of the slack.
He says the construction boom was unsustainable and so were the wages being paid to staff. The CIF are looking for the entry level wage to be cut from €14.88 an hour, which represents 80 per cent of the skilled rate, to a figure closer to 60 per cent.
"The big issue is that it is beginning to dawn on people that construction spreads so wide," says Parlon. "People were cynical that developers were doing very well, but on the other hand they were generating massive employment. Houses became too expensive, but so too did costs. The pay rates in construction were out of all proportion with anything else."
Flanagan believes that the absence of long-term industry in towns such as Castlerea means that a return to mass emigration and depopulation cannot be ruled out, now that the construction boom is over.
"In business there are makers, takers and fakers," he says. "Can anyone point out to me new bit of business in the area that was not here in the 1980s, the businesses that generate the wealth and pay the wages? Only a naive fool would rule out a return to the bad old days."
Report by RONAN McGREEVY for Irish Times Newspaper