Irish Economy
Irish Economy 2014: Claim IFSC firms employ 35,700 - official data at 23,300
By Michael Hennigan, Finfacts founder and editor
Apr 4, 2014 - 8:25 AM

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The International Financial Services Centre (IFSC), Dublin.

Irish Economy 2014: Financial Services Ireland (FSI), a unit of Ibec, the principal Irish business lobby, says in a presentation issued today that total jobs in IFSC firms amounted to 35,700 at the end of 2012. However official data puts the number at 23,300.

IFSC -- the Dublin International Financial Services Centre -- no longer just refers to the Dublin Docklands' original location but to financial services firms that are principally involved in services exporting. FSI says over 10,000 people are employed outside Dublin.

FS! claims that 6,000 jobs were added since the end of 2009.

Forfás, a research unit of the Department of Jobs, Enterprise and Innovation, puts the total number of financial services jobs at 23,300 in 2012, 21,200 at end 2009 and 12,285 at end 2003.

Forfás surveys firms that are supported by four state enterprise agencies: most jobs would relate to IDA Ireland and Enterprise Ireland.

The FSI presentation [pdf] provides no information on how the data was put together. Neither is there information on the number of firms polled or the overall firm population.  

Brendan Bruen, FSI director, said: “Even within firms with stable headcounts, roles are changing as firms seek to move into higher value activities. Based on our research, each net new job has meant two created and one lost. Employment growth has been driven by technology focused roles, and has reflected Ireland’s ability to combine financial services and ICT strengths.

“While overall employment has increased by 6,000 since 2010, the research shows significant job losses during the period as well. Banking has been the hardest hit, with several major institutions winding down their IFSC operations. This has been offset by growth in fund administration and insurance, and niche sectors like aircraft leasing are huge success stories and continue to grow.”

“The numbers also highlight the importance of the industry to the economy and the exchequer. Payroll is €2.3bn per annum, with payroll taxes of €920m paid. Corporate tax, while down from the peak, is still around €1bn, giving a total annual tax contribution of over €2bn.”

The presentation also shows that 86% of staff have at least a bachelor’s degree, and 35% hold a graduate qualification. Average salaries remain at approximately €67,000.

Patrick Manley, FSI chairman and Zurich Europe, Middle East and Africa CEO, said “Ireland’s international financial services sector has come through the crisis reasonably well, and the overall job growth figures show that. But there has been a step change in the kind of roles within the sector, today's IFSC is unrecognisable from what it was five years ago.”

The situation is a little cloudier than presented by FSI and last month the biannual Global Financial Centres Index, which polls financial services professionals across the world, put Dublin at 66 of 83 cities - - down from 13 in September 2008.

Finfacts: Global Financial Centres Index: New York overtakes London; Dublin slips to 66 of 83 cities

Brendan Bruen, FSI director, provided the following comment on our report:

"Most published data doesn't count professional services firms that handle IFSC activities. This doesn't make a lot of sense - a big four partner whose sole job is setting up and managing fund structures for clients is just as relevant as an employee of a fund administrator who does the net asset value calculations. Similarly, an employee of an outsourcing firm like Capita who is assigned solely to an international life insurer for a long period of time is clearly within scope - and such arrangements are a regular feature of how the IFSC is structured.

For the purposes of this survey, international financial services activities  are defined as:

  • Financial services provided to clients and counterparties who are not Irish, either directly or on foot of an outsourcing arrangement;
  • Services of a professional or technical nature provided to firms based in Ireland engaged in international financial services activities where such services are directly related to those activities.

A non-exhaustive list of example activities which are considered to be in scope is included below:

  • Investment/corporate banking for primarily international clients including services for international corporates domiciled in Ireland;
  • Asset (including aircraft) leasing and financing;
  • Investment management, except where provided directly to primarily Irish clients (e.g. to an Irish pension fund);
  • Fund administration and related company services;
  • Provision of life and/or general insurance to retail and non-retail consumers in other jurisdictions;
  • Reinsurance and captive insurance (including administration);
  • International payment / transactional services;
  • Treasury management for international non-financial groups;
  • Technical and shared services for financial groups;
  • Securitisation and structured finance;
  • Accounting, auditing, legal and actuarial services for international financial services activities;
  • Third-party administration services for international financial services activities;
  •  Provision of specialised financial services IT support / software development for international activities."

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