dublin city indicators · this report is part of the dublin city indicators project that encourages...
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DUBLIN CITY COUNCIL – THINK DUBLIN! RESEARCH SERIES
Q2 2010
Dublin City Indicators A commentary on Dublin’s Performance
Jamie Cudden & Helen O’ Leary
O F F I C E O F I N T E R N A T I O N A L R E L A T I O N S A N D R E S E A R C H
2
July 2010 This report is part of the Dublin City Indicators project that encourages an evidence-based approach to developing policy in the city while also highlighting the key role of Dublin in the national and international context. The Office of International Relations and Research is responsible for the development of indicators that monitor and benchmark Dublin’s economic performance. The Office also develops and commissions research that yields a better understanding of the key strategic areas that influence future city success. Jamie Cudden, Research Manager [email protected] Helen O’Leary, Research Officer [email protected]
3
OVERVIEW The Economic Development Action Plan for the Dublin City Region was developed by the four Dublin local authorities in response to the severe financial and consequent economic crisis which became apparent in 2007. The four City and County Councils – Dublin City Council, South Dublin County Council, Fingal County Council and Dún Laoghaire Rathdown County Council – came together to formulate an action plan for what has been described as Ireland’s only internationally competitive city region. A number of key policy areas were identified as in need of urgent attention in order to immobilize the pace of decline within the region, to speed the process of recovery and to enhance Dublin’s reputation as a competitive, knowledge-based global city region. From the inception of the Plan in 2008, it was agreed that any actions or recommendations of the Plan should be informed by a strong evidence base. The Dublin City Indicators project is a mechanism for the continued monitoring of Dublin’s performance across a range of policy spheres. The data highlight areas of strength and weaker points which demand informed policy action. The international aspect of the Dublin City Indicators project allows for comparison with other global city regions and prompts peer learning and collaboration. In this way, the Dublin City Indicators will enable the positioning of Dublin as a sustainable and viable City Region, a leader in the fields of technology and innovation, impacting on the quality of life available to its residents, workers and visitors.
CONTENTS OVERVIEW ......................................................................................................................................................... 3
CONTENTS .......................................................................................................................................................... 3
1. BACKGROUND ......................................................................................................................................... 4
2. INTRODUCTION ....................................................................................................................................... 4
3. EMPLOYMENT AND LABOUR FORCE ............................................................................................... 8
4. PROPERTY / CONSTRUCTION ........................................................................................................... 14
5. FOREIGN DIRECT INVESTMENT (FDI) ........................................................................................... 21
6. TOURISM ................................................................................................................................................. 23
7. PRICE COMPETITIVENESS ................................................................................................................ 26
8. DUBLIN IN THE NATIONAL CONTEXT ........................................................................................... 31
9. DUBLIN INTERNATIONALLY BENCHMARKED ........................................................................... 33
10. DUBLIN - A SMART CITY - KNOWLEDGE AND INNOVATION METRICS .............................. 37
11. THE BROADBAND CHALLENGE FOR DUBLIN ............................................................................. 40
12. DUBLIN – A GREEN AND SUSTAINABLE CITY .............................................................................. 42
13. FEEDBACK .............................................................................................................................................. 44
ACKNOWLEDGEMENTS ............................................................................................................................... 44
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1. BACKGROUND Since 2008, the Office of International Relations and Research has been developing a knowledge bank of research and indicators relating to the economy of the Dublin City Region. This draft report demonstrates how the City Indicators project is being used to monitor Dublin’s economic performance over time and in relation to the rest of Ireland and other European and international city regions where appropriate. The report will be finalised pending feedback from stakeholders. The data will be up-dated on a continuous basis and information gaps will be addressed in collaboration with advice, comments and suggestions received.
2. INTRODUCTION The most recent international economic indicators demonstrate a number of positive trends. The International Monetary Fund (IMF) in its latest global assessment for 2010, predicts that world output is expected to rise by about 4.25%, following a 0.5% contraction in 2009 (IMF Global Outlook, 2010). This recovery is largely being led by Asia and the Pacific, whilst Europe generally continues to lag. The collapse that we have seen in the Irish economy over the past couple of years is unprecedented in the history of the state. The domestic credit fuelled property boom finally peaked in 2007 and the resulting decline has wiped out the majority of the gains made in the Irish economy over the early 2000’s. This combined with the international economic downturn has created a perfect storm for Ireland. As we will see in the following commentary it really is a case of record highs and record declines. The construction sector has been the main victim of this collapse. The retail, hospitality and industry sectors have also suffered steep declines. The rapid deterioration in the public finances means that the city and national economy is now operating in the environment of drastic cutbacks in public spending as well as tax increases. The economy is facing real challenges through the collapse in the property sector, a banking crisis and the uncertainty
of how the property market will operate following the establishment of NAMA. General Economic Overview Growth levels in Irish service and manufacturing sectors have now moved back into positive territory for the first time in over 2 years (June 2010, NCB/ Markit Economics). The Ulster Bank Construction PMI is still in negative territory contracting for the 34th month running (May 2010). Consumer sentiment is now showing signs of recovery from record lows at the beginning of 2009 in the leading US, EU and Irish surveys (Reuters, Eurostat, ESRI).
40.0
50.0
60.0
70.0
80.0
90.0
100.0
110.0
Ind
ex
Consumer Sentiment Survey - Index linked (January 2008=100)
U.S.
E.U.
Irish
Source: US/ EU/ Irish Consumer Sentiment Surveys (January 2010). 2010 has seen improvement in Irish competitiveness levels. Exchange rate movements and the recent decline of the Euro against the dollar and sterling represent positive news for export competitiveness. The Euro has declined by almost 20% against the dollar from its peak in 2008 and 7% against sterling since its peak in November 2009.
1.0
1.1
1.2
1.3
1.4
1.5
1.6
1.7
0.60
0.65
0.70
0.75
0.80
0.85
0.90
0.95
Jan
-06
Mar
-06
May
-06
Jul-
06
Sep
-06
No
v-0
6
Jan
-07
Mar
-07
May
-07
Jul-
07
Sep
-07
No
v-0
7
Jan
-08
Mar
-08
May
-08
Jul-
08
Sep
-08
No
v-0
8
Jan
-09
Mar
-09
May
-09
Jul-
09
Sep
-09
No
v-0
9
Jan
-10
Mar
-10
May
-10
Euro Currency exchange rates
GBP USD
Source: Central Bank and Financial Services Authority of Ireland (2009), Exchange
US$Stg: GBP
5
The Irish Central Bank Harmonised Indicators of Competitiveness suggest a significant improvement in competitiveness levels over the past 12 months returning to levels last seen in 2005/06. Ireland’s real Harmonised Competitiveness Indicators (HCI) is still 19% above its 2000 level meaning that Irish costs remain high.
90.00
95.00
100.00
105.00
110.00
115.00
120.00
Price Competitiveness Indicators for Ireland - Real HCI (deflated by producer prices)
1999 Q1=100
Source: Central Bank, HCI's Ireland(2010).
Irish retail sales have picked up for the first time in over two years this April (2010) while motor sales have seen a significant rise with a year on year increase of 18%. This can be seen in the dramatic increase in first time private car registrations (albeit from record lows) since the beginning of 2010. Levels are still well below the peaks seen in 2007/08.
80
85
90
95
100
105
110
115
120
Ind
ex
20
05
=1
00
Retail Sales Index Volume Adjusted (Base 2005=100)
All retail businesses All retail businesses, excluding motor trades
Source: CSO, Retail Sales Index
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
Nu
mb
er
Private Car Registrations (first time)
All licensing authorities
Dublin City & County
Source: CSO, Transport Vehicles Licensed
2010 has seen a continued increase in the number of insolvencies with 146 companies becoming insolvent in the state in March 2010. This level is currently at record monthly highs. Some 40% of these insolvencies are attributed to the Dublin City Region.
0
20
40
60
80
100
120
140
160
180
JAN FEB MAR APR MAY JUNE JULY AUG SEPT OCT NOV DEC
Tota
l
State: Total Insolvencies 2007 - 2009 and Jan., Feb. 2010
2007
2008
2009
2010
Source: Insolvencyjournal.ie (2009). The ISEQ has demonstrated a gradual improvement in performance since hitting record lows in February 2009.
30.0
50.0
70.0
90.0
110.0
130.0
150.0
170.0
190.0
210.0
Au
g 9
9N
ov
99
Fe
b 0
0M
ay
00
Au
g 0
0N
ov
00
Fe
b 0
1M
ay
01
Au
g 0
1N
ov
01
Fe
b 0
2M
ay
02
Au
g 0
2N
ov
02
Fe
b 0
3M
ay
03
Au
g 0
3N
ov
03
Fe
b 0
4M
ay
04
Au
g 0
4N
ov
04
Fe
b 0
5M
ay
05
Au
g 0
5N
ov
05
Fe
b 0
6M
ay
06
Au
g 0
6N
ov
06
Fe
b 0
7M
ay
07
Au
g 0
7N
ov
07
Fe
b 0
8M
ay
08
Au
g 0
8N
ov
08
Fe
b 0
9M
ay
09
Au
g 0
9N
ov
09
Fe
b 1
0
Ind
ex
Au
gu
st 1
99
9 =
10
0
Global Stock Markets - base index August 1999 = 100
ISEQ
Nasdaq
FTSE
Dow Jones
Source: Yahoo Finance (June 2010)
*Feb 09 Bottoming out?
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National Accounts National Accounts for Ireland for the year 2009 indicate that GDP was 7.1% lower than in 2008 while GNP was 11.3% lower than in 2008. This is the largest decline in output ever recorded in a single year. Forecasts for 2010 range from -0.5% (Central Bank) to -1.5% (IMF) decline in GDP (June 2010). Most commentators predict a modest return to growth in 2011. It is anticipated that some of these figures will be revised upwards based on the latest Q1 2010 GDP figures.
€ 20,000
€ 25,000
€ 30,000
€ 35,000
€ 40,000
€ 45,000
€ 50,000
Eu
ro M
illi
on
GDP and GNP by quarter in millions of euro (2008 prices Chain Linked) and Seasonally Adjusted
GDP by quarter:
GNP by Quarter:
Source: CSO (2010) National Accounts. Gross Domestic Product (GDP) per capita is a commonly used economic indicator and measure of average living standards. In general, comparability across countries is appropriate and useful, despite potential issues where a country is host to a large number of frontier workers or where there are high outflows of income. A further well-documented short-coming is that GDP does not measure the distribution of income among citizens. If GDP per capita is coupled with high income inequalities then it does not reflect the income of the average person. According to the OECD, Ireland continued to have a relatively high GDP per capita in 2008 (see Table below). During the mid-2000s, the OECD also demonstrated that in a rank of 30 OECD countries, Ireland was placed 22nd in terms of income inequality (OECD, 2009)
Top 15 OECD countries, GDP per capita, US Dollars, 2008
Country GDP per head of population, USD
Luxembourg 84 713 Norway 58 717 United States 47 186 Switzerland 42 783 Ireland 41 493 Netherlands 41 063 Canada 38 975 Australia 38 637 Austria 37 858 Iceland 36 964 Sweden 36 938 Denmark 36 808 Finland 35 918 United Kingdom 35 631 Germany 35 432
Source: OECD Stat Extracts (2010)
Quarterly Accounts The latest National Quarterly Accounts for Q1 2010 show that Ireland is technically out of recession. GDP has increased 2.7% on the quarter while GNP is down by 0.5%. The increase in GDP has been largely been driven by growth in exports. In fact, the growth in the value of exports of goods and services has been one of the few indicators that have continued to hold its own through the downturn.
10000
15000
20000
25000
30000
35000
40000
19
97
Q1
19
97
Q3
19
98
Q1
19
98
Q3
19
99
Q1
19
99
Q3
20
00
Q1
20
00
Q3
20
01
Q1
20
01
Q3
20
02
Q1
20
02
Q3
20
03
Q1
20
03
Q3
20
04
Q1
20
04
Q3
20
05
Q1
20
05
Q3
20
06
Q1
20
06
Q3
20
07
Q1
20
07
Q3
20
08
Q1
20
08
Q3
20
09
Q1
20
09
Q3
20
10
Q1
Exports of Goods and Services (excluding Factor Income Flows)
7
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Pe
rce
nta
ge
Ireland's Share of World Trade: Merchandise and Services (%), 2000-2008
Ireland's % of World's Total Merchandise
Ireland's % of World's Total
Commercial Services
Source: World Trade Organisation (2009).
Recent figures from Dublin Port demonstrate a succession of monthly increases in exports and imports suggesting a gradual pick up in the Irish economy1.
600650700750800850900950
1,0001,0501,100
Ton
ne
s o
oo
's
Dublin Port Exports
Exports 2010
Exports 2009
Exports 2008
800900
1,0001,1001,2001,3001,4001,5001,6001,7001,800
Jan
uar
y
Feb
ruar
y
Mar
ch
Ap
ril
May
Jun
e
July
Au
gust
Sep
tem
be
r
Oct
ob
er
No
vem
be
r
De
cem
be
r
Ton
ne
s 0
00
's
Dublin Port Imports
Imports 2009
Imports 2010
Imports 2008
To put our export performance in context - Ireland accounted for just under 3% of total global service exports and about 1% of total global merchandise exports in 2008 (WTO). These are impressive figures considering the relative size of Ireland in the international context.
1 March figures include an additional 7% of exports of exported oil that had been originally imported.
In 2009 the split between exports for Ireland was thought to be 45% for services and 55% for merchandise exports (CSO, 2010). Ireland’s export success is based on the performance of a small number of sectors where our export performance is dominated by foreign owned firms. 90% of total Irish exports in 2008 were accounted for by foreign owned companies. Personal expenditure of goods and services was down by just 6% on the year (CSO, Quarterly Accounts, 2010) Following the steep fall in 2008 levels are now back to those seen in 2005/06. The retail and hospitability sectors have been especially impacted as a result of the decline in consumer spending.
10,000
12,000
14,000
16,000
18,000
20,000
22,000
24,000
26,000
19
97
Q1
19
97
Q3
19
98
Q1
19
98
Q3
19
99
Q1
19
99
Q3
20
00
Q1
20
00
Q3
20
01
Q1
20
01
Q3
20
02
Q1
20
02
Q3
20
03
Q1
20
03
Q3
20
04
Q1
20
04
Q3
20
05
Q1
20
05
Q3
20
06
Q1
20
06
Q3
20
07
Q1
20
07
Q3
20
08
Q1
20
08
Q3
20
09
Q1
20
09
Q3
20
10
Q1
Euro
Mill
ion
(Sa
)
Personal Expenditure on goods and services
In 2009 exports accounted for 17% of GDP and personal consumption 52%.
52%
17%
14%
17%
Ireland: Components of GDP, 2009
Personal consumption
Net Government Expenditure
Net Capital Formation
Net Exports
Source: CSO, National Accounts (2009).
8
3. EMPLOYMENT AND THE
LABOUR FORCE In the short time spanning the end of 2007 and the beginning of 2010 Ireland has witnessed a major scale of decline in the economy and a resulting contraction in the number in employment. Unemployment levels, the number on the live register and redundancies have hit record highs although the pace of decline in key unemployment indices has begun to moderate somewhat over the first six months of 2010. Despite this, there is no doubt as to the continued scale of the problems in the labour market and the enormous challenges the city and country face in relation to the record numbers of people who are now unemployed, underemployed or in precarious work situations. The risks and consequences of a sustained high rate of long term unemployment and forced emigration remain very real and urgent. The recent Eurobarometer perception survey on quality of life in over 70 European cities demonstrates the startling change in the employment situation in Dublin in the last number of years. In the 2006 survey Dublin was ranked the top city in the EU for ‘ease of finding a job’ when 65% of those surveyed agreed. In the most recent survey in 2009 Dublin was placed in the bottom tier of cities on the same indicator (16% of those surveyed agreed). Furthermore, during the last quarter of 2009, some 61% of people in Ireland surveyed cited ‘Unemployment’ as the most important issue facing the country. Quarterly National Household Survey (QNHS)2 The QNHS for Q4 2000 shows a national figure of 1,713,800 persons in employment. By Q4 2007, that figure had reached a high of 2,138,000, an increase of 424,200 or 24%. In the two following years there was a decrease of 251,100 persons in employment (-12%), causing a major shock to the labour market and to workers and employers alike.
2 The QNHS is conducted by the CSO and refers to the labour
force status of persons according to where they live.
100.0
105.0
110.0
115.0
120.0
125.0
130.0
135.0
140.0
145.0
150.0
Ind
ex
Lin
ked
to
Q1
20
00
= 1
00
QNHS Employment Trends Index Linked to Q1 2000
Mid East
Dublin
State
Source: CSO, QNHS Unadjusted Figures (2009). Key labour market indicators for Dublin show similar highs and lows. During the period from the end of 2000 to the end of 2007, the number in employment in the Dublin City Region grew by 81,700 persons. As with the state as a whole, the successive two year period saw the number in employment decrease dramatically from 626,800 to 550,400, or by 76,400 (12% decline). Key labour market indicators, Dublin City Region, 2000 - 2009 Year Number in
employment 000s
Number unemployed
000s
Number in labour force
000s
Q4 2000
545.1 14.6 559.7
Q4 2007
626.8 28.3 655.1
Q4 2009
550.4 66.9 617.4
Source: CSO QNHS
Unemployment The numbers unemployed in the Dublin City Region more than doubled between 2007 and 2009. By the end of 2009, there were 52,300 more people unemployed in the Dublin City Region than there were in 2000. The figures brought the Dublin City Region unemployment rate from a low of 2.6% in 2000 to 10.8% in 2009 (almost 2 percentage points below that for the state).
9
0
2
4
6
8
10
12
14
Un
em
plo
yme
nt
% R
ate
Unemployment % Rate
State
Dublin
Source: CSO, QNHS Unadjusted Figures (2009). At the end of 2007, there were 19,700 unemployed males and 8,600 unemployed females in the Dublin City Region. During the same period in 2009, the figures had more than doubled on both counts to 44,600 and 22,400 respectively.
19,700
8,600
44,600
22,400
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
50,000
Males Females
Nu
mb
er
Un
em
plo
yed
Unemployed Males and Females, Dublin City Region, 2007 and 2009
Q4 2007
Q4 2009
In 2009 the unemployment rate in Ireland was the 6th highest in the EU-27. At just under 12%, it was higher than the EU average, the US and the UK. Norway had the lowest rate of unemployment in the EEA at just 3.1%, while Spain had the highest at 18%.
0
2
4
6
8
10
12
14
16
18
20
2000 2007 2009
Un
em
plo
yme
nt
Rat
e %
Unemployment Rate, Selected Countries, 2000, 2007 and 2009
Spain
Ireland
US
EU-27
UK
Norway
Labour force participation The sum of all those employed and unemployed makes up the labour force, which has also seen some dramatic fluctuations over the nine years from 2000 to 2009. Between 2007 and 2009, the number in the Dublin City Region labour force decreased by 37,700 (-6%). This has brought the participation rate down to 63.7%, the same level as in Q4 2000. The rate for the Dublin City Region remains above that of the state, which stood at 61.2% in Q4 2009. Out migration is likely to be a key contributor to this decline. In its latest quarterly commentary (Summer 2010) the ESRI suggest that outward migration is expected to increase significantly to 70,000 people in 2010.
Those who exited the labour force may have followed a number of routes other than migration, including a return to education or training; moved from the labour force to social welfare payment other than unemployment; early or standard retirement; caring role / home duties.
10
Long Term Unemployment (LTU) A real concern for policymakers is the risk of a rapid increase in long-term unemployment. In Q1 2010, 45% of all unemployed males in the state had been unemployed for more than one year, while the same was true for 30% of all females. In the absence of a significant increase in employment levels the dramatic increase in LTU from 2009 to 2010 will be replicated over the 12 months from 2010 to 2011.
45.7%
23.5%
36.8%
32.0%
18.0%
26.8%
24.0%
16.5%
22.0%
45.0%
30.6%
40.9%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
50.0%
Male Female Total
Proportion of unemployed persons in LTU
2000 2007 2009 2010
Source: CSO QNHS Educational attainment The continued relationship between educational qualifications and labour force status is startling. Figures for the Dublin City Region in Q3 2009 show that those with primary education or below had participation rates of just 37.2% compared to those with 3rd level qualifications at 85 – 88%. The unemployment rate for those with third level
qualifications was 7% compared to over 18% for those with lower secondary qualifications.
13.818.6
12.416.5
7.6 7.011.1 11.2
37.2
52.9
73.279.2
85.4 88.8
69.2 72.2
0.010.020.030.040.050.060.070.080.090.0
100.0
Pe
rce
nt
Unemployment and participation rates according to educational attainment, Dublin, Q3 2009
Unemployment rate %
Participation Rate %
Source: CSO, QNHS Unadjusted Figures (Special Request, 2010)
These figures re-emphasise the importance of ensuring adequate education, up-skilling and training opportunities especially as future employment prospects as identified by FAS will concentrate on knowledge intensive activities. Nationally, almost 29% of those in employment had third level qualifications. The Dublin City Region’s position as a knowledge hub is evidenced by the fact that almost 50% of those employed and living in the region have third level qualifications or above. Sectoral Trends Services (market and non market) dominate employment in the Dublin City Region, accounting for 85% or over 4 in 5 persons employed. Between 2004 and 2009 there has been a continued growth nationally in the share of employment in services from 67% to 74 %. In Dublin it increased from 81% to 86 % of total employment over the same period.
86.3%
13.6%
Dublin Employment in Services- vs- Non Services Q4 2009
Services
Non-Services
Source: CSO, QNHS Database Direct (2009).
11
In Q4 2009, the largest sectors of employment in the state were in the Wholesale and Retail trade (14%), Human Health and Social Work Activities (12.4%) and Industry (11%) while in Dublin the top 3 sectors were in Wholesale and Retail trade (13.8%), Human Health and Social Work Activities (12.9%) and Financial Services and Real Estate (10%). Over half of all jobs lost in Ireland and 40% of jobs in Dublin since the peak of the boom were in the construction sector. During 2006 and 2007 approximately one in five males (20.1% - 21.5%) nationally and up to 16% in Dublin were employed in the construction industry. This now stands at 12% and 8% respectively in Quarter 4 2009. Dublin has followed the national trend and has seen major declines in employment in sectors such as Construction, Administrative and Support service activities, Industry and Wholesale and Retail trade. The construction sector experienced a decrease of 31,000 or a 40% decline from its peak in Q4 2007. Nationally the decrease was 50 %.
108.7 113.7 89.5
297.0 284.4246.9
212.1 263.7
136.7
267.8312.8
265.6
92.8
97.3
93.2
110.4
131.4
120.4
62.1
70.4
72.5
89.2
103.9
106.4
93.9
113.3
103.9
63.8
80.8
62.2
91.8
103.7
107.2
119.5
140.7
148
181.1
221.1
233.7
109.5
101.5
101.4
82.7
101
267.4
0.0
250.0
500.0
750.0
1,000.0
1,250.0
1,500.0
1,750.0
2,000.0
2,250.0
2004Q4 2007Q4 2009Q4
Nu
mb
er
Emp
loye
d
QNHS - Sectoral Trends State (Q4 2004, Q4 2007 and Q4 2009)
Unemployed
Other NACE Activities
Human Health and Social Work Activities
Education
Public Administration and Defence;
Compulsory Social SecurityAdministrative and Support Service ActivitiesProfessional, Scientific and Technical ActivitiesFinancial, Insurance and Real Estate
ActivitiesInformation and Communication
Accommodation and Food Service ActivitiesTransportation and Storage
Wholesale and Retail Trade
Construction
Industry
Agriculture, Forestry and Fishing
Source: CSO, QNHS Database Direct (2009).
59.5 57.8 47.4
43.1 58.3
27.3
84.690.8
76
38.337.0
38.4
34.636.5
30.4
32.335.5
33.8
46.3
54.7
55.2
41.0
47.6
43.2
23.6
30.1
21.2
31.9
34.8
32.5
38.4
39.0
41.1
53.9
68.9
71.2
37.1
34.8
32
23.1
28.3
66.9
0.0
100.0
200.0
300.0
400.0
500.0
600.0
700.0
2004Q4 2007Q4 2009Q4
Nu
mb
ers
Em
plo
yed
QHNS - Sectoral Trends in Dublin - (Q4 2004, Q4 2007 and Q4 2009)
Unemployed
Other NACE Activities
Human Health and Social Work Activities
Education
Public Administration and Defence; Compulsory Social Security
Administrative and Support Service Activities
Professional, Scientific and Technical Activities
Financial, Insurance and Real Estate Activities
Information and Communication
Accommodation and Food Service Activities
Transportation and Storage
Wholesale and Retail Trade: Repair of motor vehicles and motorcycles
Construction
Industry
Agriculture, Forestry and Fishing
Source: CSO, QNHS Database Direct (2009). It is important to note that sectoral data is only available at a broad level. Indicators that monitor performance in sub sectors such as life sciences, software services, and digital media for example are not currently available. The Dublin City Region dominates in the national context especially in the sectors of Financial, Insurance and Real Estate Activities, Information and Communication.
12
Place of work analysis The Place of Work Census Anonymised Records (POWCAR) dataset demonstrates that in 2006 37% of all jobs in the State were located in the Dublin City Region while the GDA was home to 45% of all jobs in the State. The administrative area of Dublin City accounted for one in five of all jobs (21%) nationally3. Census 2011 will provide a very important dataset to monitor the trends in where jobs are located, during the sustained period of job losses of the last number of years.
Location Percentage of All Jobs Nationally
Dublin City 20.94
South Dublin 5.99
Fingal 5.3
Dún Laoghaire Rathdown 4.73
Dublin County 36.95
Wicklow 2.09
Meath 2.41
Kildare 3.91
Mid East 8.41
Greater Dublin Area 45.36
Applying these POWCAR proportions4 to the Q4 2009 QNHS number in employment in the state, we estimate that the total number of those employed in Dublin City Council is 396,417, in the Dublin City Region is 697,505 and the GDA is approximately 856,260. Redundancies 2009 was a record breaking year for the number of redundancies. Nationally, the number of redundancies in 2009 stood at almost 77,000, an increase of 90% from the 2008 figure (DETE,2010). The levels of redundancies are now up over 670% from 2000 levels.
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Nu
mb
er
of
red
un
dan
cie
s
Total Redundancies in the State by Year
Redundancies by Year
Source: DETE, Actual Redundancy Statistics (2009).
3 Excluding where no address in known and mobile workers.
4 Redundancy figures also demonstrate similar breakdowns by region.
The Dublin City Region experienced over 30,000 redundancies in 2009, accounting for just under 40% of the national total. There has been a slight moderation in the numbers of redundancies from Feb to May 2010 compared to 2009 levels. However the numbers are still ahead of 2008 levels with 2,000 redundancies in May 2010 in the Dublin City Region and 5,000 redundancies in the state.
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Nu
mb
er
of
Re
du
nd
anci
es
State: Actual No. of Redundancies by Month, State
2008 2009 2010
Source: DETE, Actual Redundancy Statistics (2010)
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Nu
mb
er
of
Re
du
nd
anci
es
(Th
ou
san
ds)
Number of Redundancies in Dublin Region
2008 Dublin Region 2009 Dublin Region 2010 Dublin Region
Source: DETE, Actual Redundancy Statistics (2010) The Dublin City Region areas with the highest number of redundancies in 2009 are identified as County Dublin, Dublin 12, Dublin 2, and Dublin 24.
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
Nu
mb
er
of
Re
du
nd
anci
es
Redundancies in the Dublin Region - 2009
Dublin Redundancies Male Dublin Redundancies Female
Source: DETE, Actual Redundancy Statistics (2009).
13
Live Register The live register figures are at all time record highs at levels never before seen in the history of the state. The rate of decline appears to have slowed down over recent months with the annual rate of change at about 10% compared to up to 90% during 2009. The unadjusted Irish Live Register total for the state was 437,992 in May 2010 (increasing slightly from April) while there were 104,818 persons on the live register in the Dublin City Region. The scale of increase has been dramatic considering that in 2007 the levels were at about 150,000 in the state and about 40,000 for Dublin. Some 67% of those on the live register are male.
0
50000
100000
150000
200000
250000
300000
350000
400000
450000
500000
Nu
mb
ers
Live register in Dublin and State
Dublin
State
Source: CSO, Live Register (May 2010).
0.0
50.0
100.0
150.0
200.0
250.0
300.0
Ind
ex
= 2
00
0
Live Register Dublin (index = 2000)
Index male Index Female Index Total
Source: CSO, Live Register (May 2010). Employment Outlook The employment outlook in the short term for the city and state is for a deceleration in the pace of decline. As the economy picks up and returns to growth there is likely to be a significant lag period before there is any real return to employment growth.
14
4. PROPERTY / CONSTRUCTION The construction sector has been particularly affected with a collapse in output and the numbers employed from the height of its peak in 2007. The CSO Quarterly National Accounts for Q1 2010 demonstrate a continued decline in the total levels of investment in the economy as measured by ‘gross fixed capital formation’ where there has been a decline of over 30% in the year to date (Q1 2010). Investment levels are now back at pre-1997 levels largely due to the collapse in construction activity.
0
2000
4000
6000
8000
10000
12000
14000
19
97
Q1
19
97
Q3
19
98
Q1
19
98
Q3
19
99
Q1
19
99
Q3
20
00
Q1
20
00
Q3
20
01
Q1
20
01
Q3
20
02
Q1
20
02
Q3
20
03
Q1
20
03
Q3
20
04
Q1
20
04
Q3
20
05
Q1
20
05
Q3
20
06
Q1
20
06
Q3
20
07
Q1
20
07
Q3
20
08
Q1
20
08
Q3
20
09
Q1
20
09
Q3
20
10
Q1
Euro
Mill
ion
(Sa
)
Gross Domestic Fixed Capital Formation
All of the indicators relating to new house building including commencements, registrations and construction employment are exceptionally weak. There are few signs to indicate any change in this situation with the construction sentiment Ulster Bank Purchasing Managers Index (PMI) indicators weakening for the 34th month in a row (April 2010). The March reading of 42.3 was still below the expansion threshold of 50. Expectations within the sector suggest that construction levels will not return to expansion levels until at least January 2011 (Construction Sector PMI May 2010). However as existing infrastructural projects are completed there are likely to be further job losses in the construction sector over the coming quarters.
Planning activity will be the first to pick up in the event of a recovery. However the current indicators for planning permissions show record lows. Nationally, the total number of units granted planning permission in Q1 2010 was 5,510 units compared to Q2 2005 where 28,818 units were granted planning (over 80% decline). In Dublin there were just 1,520 units granted planning in Q1 2010 compared to a record 8,500 units in Q3 2003.
0
5000
10000
15000
20000
25000
30000
35000
40000
Nu
mb
ers
Gra
nte
d
Planning Permissions - Units Granted
State Dublin Source: CSO, Planning Permissions (Septmeber 2009).
Housing commencements are at record lows with monthly levels down over 90 % from their highs in 2006. There were only 30 commencements in the Dublin City Region in March 2010 compared to 1,800 in April 2006. For the State there were 683 residential commencements in March 2010 compared to 8,500 at the peak in June 2006.
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
Tota
l Co
mm
en
cem
en
t N
oti
ces
Total Commencement Notices- residential units
Total State Dublin
Source: Department of Environment, Heritage and Local Government (2009).
15
The proxy for housing completions, ESB residential connections5 are a long way off their peak of 90,000 in 2006 with just 26,000 competions in 2009. This represents a decline of over 70 % from peak levels. The Dublin City Region recorded 5,300 competions compared to 22,000 in the equivalent period in 2006.
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
100,000
Housing Completions
State
Dublin
Mid East
0
50
100
150
200
250
300
350
400
Ind
ex
Lin
ked
to
Q1
20
00
House Completions in All Local Authorities and Dublin (Index Linked to Q1 2000)
All Local Authorities Dublin Region Dublin (City Council)
Source: Department of Environment, Heritage and Local Government (2009).
It is useful to highlight the fact that Dublin did not dominate nationally in terms of construction activity. In fact it was a national phenomenon where a high proportion of building occurred outside of the Dublin City Region in particular. Dublin accounted for about 25% of total national completions during the 2000’s. New house registrations are at record lows down over 90 % from the peaks in 2006. There were just 800 and 200 registrations in the State and Dublin respectively for the final quarter of 2009.
5 There are real quality issues with the use of ESB connections as many housing units may still be vacant without a ESB connection.
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000
To
tal
New House Registrations
All Counties Dublin
Source: Department of Environment, Heritage and Local Government (2009).
0.0
50.0
100.0
150.0
200.0
250.0
To
tal
Ne
w H
ou
se R
eg
istr
ati
on
s B
ase
=2
00
0
New House Registrations (Index linked to 2000)
All Counties Dublin
Source: Department of Environment, Heritage and Local Government (2009).
Housing Affordability House prices have now declined by up to 40% in places and affordability indices demonstrate an improvement in affordability for first time buyers. The latest quarterly EBS / DKM Affordability Index demonstrates that in June 2010 the average first time buyer working couple in Dublin was paying 12.4% of their joint income to service their mortgage compared with 26.4% in December 2006, representing a 50% improvement in the past three years. While affordability is increasing there are still issues in accessing finance from the banks. Increasing mortgage rates are also acting as a deterrent to would be first time buyers entering the market.
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
35.00%
Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Mar 10 Actual
April 10 Estimate
June 10 Forecast
Mo
nth
ly R
ep
aym
en
ts
Dublin Monthly Repayments as % of Net Income
Dublin first time buyer working couple Source: EBS, DKM Affordability Index (2010).
16
House Price Index House prices have declined dramatically from their peak levels in 2007 and have returned to 2002 levels. The permanent tsb/ESRI house price index6 estimated that the average price for a house in Dublin was €250,872 in Q1 2010 compared to over €429,000 in 2007 (down €176,000). The year on year decline in Dublin was 24.5% while prices are 41% down from their peak in 2006. This compares to a national decline of 24%. Average national house prices are down 4.8% in first 3 months of 2010 while Dublin house prices fell by 10.3%.
€50,000
€100,000
€150,000
€200,000
€250,000
€300,000
€350,000
€400,000
€450,000
Ho
use
Pri
ce I
nd
ex
Permanent TSB / ESRI House Price Index
National Outside Dublin Dublin
Source: Permanent TSB/ ESRI House Price Index (2009).
100
120
140
160
180
200
220
240
Jan
-00
Au
g-0
0
Mar
-01
Oct
-01
May
-02
De
c-0
2
Jul-
03
Feb
-04
Sep
-04
Ap
r-0
5
No
v-0
5
Jun
-06
Jan
-07
Au
g-0
7
Mar
-08
Oct
-08
May
-09
De
c-0
9
Ind
ex
Lin
ked
to
Jan
uar
y 2
00
0
Permanent TSB/ ESRI House Price Index
National
Outside Dublin
Dublin
Source: Permanent TSB/ ESRI House Price Index (2009).
The number of home loans approved in the state continues to decline down to about 2,500 nationally in Q3 2009. This compared to 16,000 in Q2 2006.
6 Due to the low volumes of transactions the main house price index from
permanent TSB is now published on a quarterly basis.
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
No
. of
Ho
me
Lo
ans
Ap
pro
ved
No. of Total Home Loans approved
No of Home Loans approved …
Source: Department of Environment, Heritage and Local Government (2009).
17
Residential Rental According to the Daft Rental Q1 2010 report rental prices are down by almost 25% nationally from their peaks in 2007/08. During the past quarter the general trend of rents is still downward in most parts of the country, although in Dublin and Cork, rents were largely static. In Dublin city centre, rents rose 1.3% over the quarter. The stock of properties available to rent in the capital has risen 5% since January.
70
75
80
85
90
95
100
105
110
115
120
Ind
ex
= 2
00
7 a
vera
ge =
10
0
Daft National Rental Index
Source: Daft.ie Rental Report (2009).
International Perspective A sign of Dublin’s decline in relation to the real estate sector was evident in the 2009 Jones La Salle European Regional Growth Index which assesses the attractiveness of regions for investment in Real Estate Markets. Dublin saw its performance drop from 3rd to 73rd postion reflecting the collapse of the property bubble that had been expanding since the early 1990’s. At the peak of the property boom in 2006, Ireland was building 21 housing units per 1000 of its population, when the European average was 5.6. In 2009, Irish completions amounted to 5.8 units per
1000, whereas the European average is estimated to be less than 4 (Euroconstruct/DKM 2010)
International House Price Index Ireland now ranks 43rd in the latest Knight Frank global house price index Q1 2010 under the indicator ‘average annual growth in house prices’. The global index shows house prices now rising in more than half of countries across the globe. The Asia Pacific region saw the strongest growth with prices increasing, on average, by 19% on the year. Annual price inflation for all global housing markets moved into positive territory for the first time since Q4 2008, recording 1.6% growth in the year to March 2010. The top performers remain the Asian economies of China, Hong Kong and Singapore all recording annual growth in excess of 24%
18
-50% -30% -10% 10% 30% 50% 70% 90%
China (key cities) Hong Kong Singapore
Australia Israel
South Africa Canada Finland
Norway Sweden
United Kingdom Austria
India Colombia
New Zealand Switzerland
Netherlands Luxembourg
Portugal Malaysia
Indonesia United States
Germany Hungary Belgium
Malta Denmark
Greece Japan
Italy France
Slovenia Iceland
Spain Poland Jersey
Czech Republic Dubai, UAE
Slovak Republic Russia
Croatia Bulgaria Ireland
Latvia Lithuania
Ukraine Estonia
Perc
enta
ge C
hang
e
House Price Change Q1 2009 - Q1 2010Source: knight Frank , Global House Price Index .
Commercial Property In relation to commercial and retail property, Dublin has moved from being one of the most expensive cities in Europe to one that is much more affordable in the space of 2 years. Commercial office rents have decreased by up to 40 % from their peak levels across the city centre (representing one of the sharpest corrections seen in Europe in 2009, Knight Frank). Over the year Q4 2008-2009 Dublin prices have declined 30 %.
Dublin is now a good value city location for commercial office rents positioned behind competitor cities such as Geneva, Zurich, Amsterdam, Frankfurt and Luxemburg. In relation to the average occupancy costs per workstation Dublin
is now 33rd most expensive representing a considerable decline over the year (DTZ, 2010).
$5,000$7,000$9,000
$11,000$13,000$15,000$17,000$19,000$21,000$23,000$25,000
Lo
nd
on
(W
est
En
d)
To
ky
o (
Ce
ntr
al
5 W
ard
s)
Wa
shin
gto
n D
.C.
Ho
ng
Ko
ng
Ge
ne
va
Pa
ris(
CB
D)
Ne
w Y
ork
Cit
y …
Zu
ric
h
Bo
sto
n
Fra
nk
furt
Du
ba
i
Ab
u D
ha
bi
Mil
an
To
ron
to
Ca
lga
ry
Lo
nd
on
(Cit
y)
Do
ha
Mu
nic
h
Lu
xe
mb
ou
rg
Am
ste
rda
m
He
lsin
ki
Osl
o
Sy
dn
ey
Ro
me
Du
sse
ldo
rf
Va
nc
ou
ve
r
Mu
mb
ai
Sto
ck
ho
lm
Bri
sba
ne
Ha
mb
urg
Ott
aw
a
Pe
rth
Du
bli
n (
33
)
Occupancy cost per workstation (US$)
2009
2008
According to CBRE prime office rents in Dublin have declined from an average of 673 Euro per sq m pa in 2008 to 376 Euro per sq m pa in Q2 2010 (a decline of 44 %). Prime rents in the city centre are now stabilising at €376 per square metre. However rents for secondary accommodation and office properties in the suburbs remain under downward pressure (CBRE 2010). The collapse in the construction sector and uncertainty of finance and NAMA has resulted in the situation where there are no new office schemes scheduled to be completed in the Dublin market beyond 2010.
0
100
200
300
400
500
600
700
800
Pri
me
Re
nt
(Eu
ro)
Prime Rents in Dublin
Prime Rent (€ per sq m pa)
Source: CBRE Market Data (2009).
19
0
5
10
15
20
25
Vac
ancy
Rat
e
Dublin Office Vacancy Rate (%)
Vacancy Rate (%)
Source: CBRE Market Data (2009). The overall vacancy rate for Office Stock is holding steady at 23.5% as of the end of Q2 2010. It is reported that much of this comprises floors in otherwise occupied buildings as opposed to empty buildings (CBRE 2010) Much of the office demand is centred on city centre locations (over 70 %) Retail The Dublin City Region retail market has seen significant declines in rental values on both the high street and in shopping centres. As of Q2 2010 prime Zone A rental levels have declined by as much as 47.5% from peak levels (Grafton Street) and although the pace of decline has slowed considerably in recent months, downward pressures remain. In the latest Q1 2010 CBRE Marketview commentary on global retail rents Dublin is now in 20th position (down 4 places from the previous quarter) In the Europe, Middle East and Africa (EMEA) region, Dublin had the second highest annual fall in retail rents.
According to CBRE 27% of international retailers have a presence in the Irish market - Ireland ranks 32nd in
20
terms of international retailer presence. With regards to international retailer representation, Dublin ranks 55th out of 150 cities. The city attracted 35 international retail projects between 2007-09 including Disney, Gap, H&M and Abercrombie & Fitch (FT, FDI investment monitor 2009) Cushman & Wakefield’s annual publication ‘Main Shopping Streets’ saw Grafton Street drop from 5th most expensive street in 2008 to the 8th most expensive street in the world in 2009.
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
Re
nt
Euro
/sq
/m/y
r
Rent €/sq.m/yr for the Most Expensive Streets in the World in 2009
Source: Cushman and Wakefield, Main Shopping Streets report ( September 2009).
21
5. FOREIGN DIRECT INVESTMENT7
(FDI)
A bright light in the Dublin and National economy has been the constant flow of announcements relating to FDI expansions and the attraction of new projects in 2010. 2009 was a particularly difficult year globally for FDI with a 39% decline in global FDI flows (UNCTAD). Even though 2009 was a difficult year it has been reported that Ireland recorded FDI inflows of $25bn (€19bn) in 2009. This was more than half the figure recorded for the UK and accounted for the 16th highest level of FDI inflows in the world for 2009 (UNCTAD 2010). The total number of FDI projects attracted to Ireland and Dublin was down about 10% between 2008 and 2009 with a steeper decline in the total number of jobs created. The first half of 2010 has witnessed a modest, but uneven recovery for FDI across the globe with Ireland and Dublin performing particularly well.
0
50
100
150
200
250
Ind
ex
Lin
ked
to
20
05
=1
00
Global FDI Trends
Global FDI
Source: UNCTAD, Global Investment Trends Monitor (January 2010)
7 FDI is measured by total inflows (UNCTAD), IDA supported investments and
the Financial Times (FT) FDI investment monitor.
116
183172
56
79 78
2007 2008 2009
FDI*Ireland 2009
Ireland's Projects Dublin Projects
Source: fdiintelligence.com (2009)*all mobile investment included
The number of IDA supported investments in Ireland up to July 2010 at 55 has already overtaken the total number of 52 projects in 2009. Some 31 of these announcements or 70% of the national total of announcements related to the Dublin City Region and included companies such as AXA, Zurich, IBM, LinkedIn, SAP, WebRoot and Riot games.
38
56
5255
10
17
25
31
2007200820092010 (YTD)
IDA - FDI announcements
Ireland Dublin
Source: IDA (2010), FDI Announcements.
The nature of recent investments has been that of higher quality employment with a lower number of jobs created. The Dublin City Region has been particularly successful in attracting International and European Headquarters (e.g. Kellogg’s, Facebook, LinkedIn). There have also been a number of R&D announcements that have been a boost to the region (for example IBM smart city centre, Citi and Alcatel Lucent).
22
The dominance of software and IT, financial and business services is apparent for the Dublin City Region accounting for over 56% of all FDI announcements from 2007 to 2009.
5753
35 34
1511
7 6 5 5
0
10
20
30
40
50
60
No
. of
Pro
ject
s
Number of Projects Announcements Dublin by Business Activity in 2007-09
Source: fdiintelligence.com(2009)
56
41
2321
9 8 7 6 6 64
0
10
20
30
40
50
60
No
. of
Pro
ject
s
Number of FDI Projects Announcements Dublin by Sector in 2007-09
Source: fdiintelligence.com (2009)
The draw of Dublin as an attractive destination for FDI investment in Ireland is clear. The 2007 - 09 figures show that over 50% of total national FDI investment is locating in the Dublin City Region (FT, FDI benchmark). In the national perspective the Dublin City Region accounts for 67% of all software and IT projects and approximately 60% of all financial and business services announcements. Almost 90% of all headquarter announcements were in Dublin between 2007 and 2009. European Cities and Regions of the Future 2010 / 2011 compiled annually by fdi Magazine placed Dublin as the 6th top European City and 3rd in Northern Europe. The city region was ranked 4th in terms of its economic potential.
0 50 100 150 200 250 300
London
Paris
Moscow
Madrid
Dublin
Barcelona
Istanbul
Munich
Bucharest
Saint Petersburg
Frankfurt am Main
Milan
Berlin
Vienna
Düsseldorf
Prague
Amsterdam
Stockholm
Budapest
Manchester
Kiev
Number
Top Locations of FDI Projects in 2009 Q1 to Q4
Source: fdiintelligence.com (2009)
Ernst and Young’s European Attractiveness Report on FDI highlights Dublin’s impressive performance as the 5th most attractive city for inward investment in Europe in 2009. In 2009, Dublin attracted the fifth highest number of FDI projects across European Cities (2010, Financial Times, FDI investment monitor). It should be noted that the origin of FDI into Ireland is dominated by US (35%), UK (26%) and German firms (6%) accounting for over 67% of the total FDI attracted to Ireland between 2007 and 2009.
0 50 100 150 200 250 300
London
Paris
Moscow
Madrid
Dublin
Barcelona
Istanbul
Munich
Bucharest
Saint Petersburg
Frankfurt am Main
Milan
Berlin
Vienna
Düsseldorf
Prague
Amsterdam
Stockholm
Budapest
Manchester
Kyiv
Number
Top Locations of FDI Projects in 2009 Q1 to Q4
Source: fdiintelligence.com(2009)
23
6. TOURISM Dublin and Ireland have experienced exceptionally strong growth up to 2008 in the numbers of tourists visiting.
6,371 6,5746,976
7,7118,018
8,454
7,553
34453680
39374306 4449 4310
3,882
2003 2004 2005 2006 2007 2008 2009
International Tourists 2003 - 2009 (1,000s)
Ireland Dublin
Source:CSO, Failte Ireland (2010) However recent times have seen the tourism sector in Ireland badly impacted by the global recession with a drop of over 18.5% in the numbers of overseas visitors in March 2010 compared to March 2009 (CSO, Failte Ireland, 2010). This decline in tourist numbers has had a real impact on the hospitality and retail sectors across the city. International tourism revenue in the Dublin City Region was worth over €1.23 billion in 2009 down from €1.41 billion in 2008 (down 12.5%). There were over 3.88 million visitors in 2009 down from 4.3 million in 2008 (almost 10% decline). Dublin is a key driver of national tourism revenues accounting for 32% of Ireland’s total tourism revenue in 2009.
2003 2004 2005 2006 2007 2008 2009
Britain 1798 1819 1931 1864 1743 1689 1,464
Mainland Europe 922 965 1175 1483 1711 1680 1,588
North America 552 644 625 732 761 674 615
Other Areas 173 252 206 226 235 267 214
0
200
400
600
800
1000
1200
1400
1600
1800
2000
(00
0's
Vis
ito
rs)
Origin of International Tourism to Dublin
Source:CSO, Failte Ireland (2010)
There has been a decline of 19% since 2003 in the number of tourists coming from Britain (the weakness of Sterling has had a major impact here). Tourists from mainland Europe have continued to increase year on year up from 922,000 in 2003 to 1.59 million in 2009 (up a remarkable 72%). The overall figures for international tourism in Dublin are up 13% since 2003. Domestic tourism is also important for the city. With less people travelling abroad there has been an increase in domestic tourists to Dublin from 1.4 million visits in 2009 (1.2m in 2008) with revenue of €216 million in 2009 (€150 million in 2008). Dublin accounted for about 32% of hotel rooms nationally in 2008 with 19,100 rooms and 160 hotels (Failte Ireland, 2009). The hotel sector is currently facing serious challenges as demand falls alongside significant discounting of room prices.
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000
No
. of
Ro
om
s
No. of Hotel Rooms by County 2008
Source: Failte Ireland, Hotel review Report 2008 Dublin was the 19th most popular international city destination according to the Euromonitor international top cities destinations 2008.
0
5
10
15
20
25
Ran
kin
g
Top City Destinations Ranking in 2008
Source: Euromonitor International Top Cities Destination 2008
24
The European Cities Marketing visitors report on the premier league of cities in Europe places Dublin 9th most popular city in Europe in terms of bed nights just behind Vienna (2007).
Hotel prices in Dublin are now amongst some of the cheapest in the world according to the hotels.com price index (54th out of 64 international cities). Prices have declined by over 23% over the year 2008-09. Dublin is now a very attractive destination for travellers looking for cheaper stays in the euro zone. It has been recently reported that Dublin hotel prices are now back to 1999 levels (Horwath Bastow Charleton, 2010).
€0 €20 €40 €60 €80 €100 €120 €140 €160 €180
Monte Carlo Abu Dhabi
Geneva Moscow
New York Rio De Janeiro
Venice Zurich Dubai
Boston Washington
Jerusalem Copenhagen
Paris London
Tokyo Chicago
Oslo Istanbul
Singapore Edinburgh
Milan Cairo
Rome Mumbai
Stockholm St Petersburg
Amsterdam Gothenburg
Frankfurt Cancun
Quebec City Barcelona
Helsinki Munich
Seoul Brussels Florence
Hong Kong Cape Town
Reykjavik Montreal
Vienna Bucharest
Toronto Sydney
Marrakech Madrid Seville Lisbon
New Delhi Buenos Aires
Berlin Dublin
Shanghai Krakow
Mexico City Budapest
Prague Beijing
Las Vegas Bangkok
Tallinn Riga
Hotels:Average Price per Room Per Night 2009
Source. Hotel.co.uk , Hotel price Index (2009).
A 2009 survey by the UK Post Office sees Dublin as one of the best value city break destinations in Europe. This comes as welcome relief to the tourism sector which has been struggling in recent years due to the economic downturn and also Dublin’s reputation for being one of the most expensive capitals in Europe to visit. The opening of the Convention Centre Dublin in Autumn 2010 should be a major boost for tourism in the city.
0
50
100
150
200
250
300
350
Po
un
ds
UK Post Office City Cost Barometer, 2009
Source: UK Post Office City Barometer (2009). Nine out of the top 10 tourist attractions in Ireland were located in the Dublin City Region. At number one was the Guinness Storehouse with over 1 million visits in 2008.
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
Top
Att
ract
ion
s
Ireland's Top 10 Tourist Attractions 2008
Source: Failte Ireland, Visitor Attractions 2008
25
The number of passengers from cruise liners visiting Dublin has increased from 60,000 in 2006 to 120,000 in 2009 (Dublin Port, 2009).
0
20000
40000
60000
80000
100000
120000
140000
0
10
20
30
40
50
60
70
80
90
2006 2007 2008 2009
Nu
mb
er
of
Pas
sen
gers
Nu
mb
er
of
Cru
ise
Lin
ers
Number of Cruise Liners Visiting Dublin
Number of Passengers Number of Cruise Liners
Source: Dublin Port Annual report
26
7. PRICE COMPETITIVENESS 2010 has seen some improvement in Irish competitiveness levels. Exchange rate movements and the recent decline of the Euro against the dollar and sterling represent positive news for export competitiveness. The Euro has declined by almost 20% against the dollar from its peak in 2008 and 7% against sterling since its peak in November 2009.
1.0
1.1
1.2
1.3
1.4
1.5
1.6
1.7
0.60
0.65
0.70
0.75
0.80
0.85
0.90
0.95
Jan
-06
Mar
-06
May
-06
Jul-
06
Sep
-06
No
v-0
6
Jan
-07
Mar
-07
May
-07
Jul-
07
Sep
-07
No
v-0
7
Jan
-08
Mar
-08
May
-08
Jul-
08
Sep
-08
No
v-0
8
Jan
-09
Mar
-09
May
-09
Jul-
09
Sep
-09
No
v-0
9
Jan
-10
Mar
-10
May
-10
Euro Currency exchange rates
GBP USD
Source: Central Bank and Financial Services Authority of Ireland (2009), Exchange
US$Stg: GBP
Recent research from the European Commission acknowledges that Ireland has registered significant gains in cost competitiveness in 2008 and 2009 (European Commission, Surveillance of Intra-Euro-Area Competitiveness and Imbalances, 2010). The Irish Central Bank Harmonised Indicators of competitiveness suggest a significant improvement in our competitiveness levels over the past 12 months returning to levels last seen in 2005/06. Ireland’s real HCI is still 19% above its 2000 level meaning that Irish costs remain high relative to historic levels and those in other countries.
90.00
95.00
100.00
105.00
110.00
115.00
120.00
Price Competitiveness Indicators for Ireland - Real HCI (deflated by producer prices)
1999 Q1=100
Source: Central Bank, HCI's Ireland(2010).
Price competitiveness has improved significantly against our international competitor cities. The recent Mercer Cost of Living results for 2010 places Dublin as the 42nd most expensive city in the world; this represents a significant improvement over previous surveys. Dublin previously ranked 25th in 2009 and 13th in 2005 (however these results are not directly comparable between the years due to methodological changes in the Mercer Survey). The most expensive European cities were Geneva, Zurich and Copenhagen.
0 10 20 30 40 50 60
LUANDA (1)TOKYO
NDJAMENAMOSCOW
GENEVAOSAKA
LIBREVILLEZURICH
HONG KONGCOPENHAGEN
SINGAPOREOSLO
VICTORIASEOULMILAN
BEIJINGLONDON
PARISTEL AVIVNAGOYA
SAO PAULOBERN
NIAMEYSYDNEY
SHANGHAIROME
NEW YORKVIENNA
RIO DE JANEIROST. PETERSBURG
HELSINKIDAKAR
BANGUIMELBOURNEAMSTERDAM
BAKUBRATISLAVA
GUANGZHOUNOUMEA
ATHENSDOUALA
SHENZHENDUBLIN (42)
ISTANBULABIDJANHAVANAPRAGUE
BRAZZAVILLEBARCELONAFRANKFURT
ABU DHABI (50)
Top 50 cities: Mercer Cost of living (2010)
27
The latest UBS international prices and earnings survey (2009) shows Dublin dropping from 4th most expensive city in the word in 2008 to 10th in 2009. Oslo, Copenhagen, Zurich and Geneva named the most expensive cities.
50
60
70
80
90
100
110
120
Ind
ex
UBS Prices 2009 Index (ex rent, New York=100)
Source: UBS, Prices and Earnings (August 2009).
From April 2009 to April 2010, Ireland experienced a 2.5 % decrease in the harmonised index of consumer prices (HICP). This was the second highest decrease in the European Union. During the same period the euro area HICP increased by 1.4 %. The consumer price index while declining is still about 20 % above 2001 levels and about 7 % below its peak levels in 2008. While prices are dropping and Dublin is becoming an increasingly affordable to visit, work and live, there are some real structural concerns over costs particularly relating to professional and government services. There have been continued increases in Education and Health sectors. Inflation is predicted to return to positive territory later in 2010 due to price increases in fuel prices and imports (due to currency fluctuations). Our improvement in cost competitiveness has mainly been a result of the Irish and International recession and not a result to specific structural changes in the Irish Economy (2010 NCC)
-8
-6
-4
-2
0
2
4
6
Pe
rce
nta
geC
han
ge
Ireland: Inflation Annual Rate of Change (CPI and HICP)
CPI HICP
Source: CSO, Consumer Price Index (2010).
Another concern relates to the food prices in Ireland and a realization that Irish consumers are paying a lot more for their food in comparison to other European countries. A recent Eurostat (2010) annual comparison of food prices across the EU shows that the prices in Ireland are the second highest in the EU after Denmark. What is more worrying is that instead of coming down faster in Ireland than in other countries food prices were actually relatively higher in 2009 than in 2008 or 2007. Irish consumers pay 29.2% more than the EU average. Oil prices have steadied out at around 70 dollars a barrel. However as the global economy picks up oil prices are likely to rise to 2007-08 levels which will put pressure on inflation levels.
0
20
40
60
80
100
120
140
Do
llars
$
Sept 2006 to January 2010 - Average Monthly Oil Price
Average Monthly Oil Price Source: OPEC, Monthly Basket Price (2010).
28
Commercial Property In relation to commercial and retail property, Dublin has moved from being one of the most expensive cities in Europe to one that is much more affordable in the space of 2 years. Commercial office rents have decreased by up to 40 % from their peak levels across the city centre (representing one of the sharpest corrections seen in Europe in 2009, Knight Frank). Over the year Q4 2008-2009 Dublin prices have declined 30 %.
Dublin is now a good value city location for commercial office rents positioned behind competitor cities such as Geneva, Zurich, Amsterdam, Frankfurt and Luxemburg. In relation to the average occupancy costs per workstation Dublin is now 33rd most expensive representing a considerable decline over the year (DTZ, 2010).
$5,000$7,000$9,000
$11,000$13,000$15,000$17,000$19,000$21,000$23,000$25,000
Lo
nd
on
(W
est
En
d)
To
ky
o (
Ce
ntr
al
5 W
ard
s)
Wa
shin
gto
n D
.C.
Ho
ng
Ko
ng
Ge
ne
va
Pa
ris(
CB
D)
Ne
w Y
ork
Cit
y …
Zu
ric
h
Bo
sto
n
Fra
nk
furt
Du
ba
i
Ab
u D
ha
bi
Mil
an
To
ron
to
Ca
lga
ry
Lo
nd
on
(Cit
y)
Do
ha
Mu
nic
h
Lu
xe
mb
ou
rg
Am
ste
rda
m
He
lsin
ki
Osl
o
Sy
dn
ey
Ro
me
Du
sse
ldo
rf
Va
nc
ou
ve
r
Mu
mb
ai
Sto
ck
ho
lm
Bri
sba
ne
Ha
mb
urg
Ott
aw
a
Pe
rth
Du
bli
n (
33
)
Occupancy cost per workstation (US$)
2009
2008
According to CBRE prime office rents in Dublin have declined from an average of 673 Euro per sq m pa in 2008 to 376 Euro per sq m pa in Q2 2010 (a decline
of 44 %). Prime rents in the city centre are now stabilising at €376 per square metre. However rents for secondary accommodation and office properties in the suburbs remain under downward pressure (CBRE 2010). The collapse in the construction sector and uncertainty of finance and NAMA has resulted in the situation where there are no new office schemes scheduled to be completed in the Dublin market beyond 2010.
0
100
200
300
400
500
600
700
800
Pri
me
Re
nt
(Eu
ro)
Prime Rents in Dublin
Prime Rent (€ per sq m pa)
Source: CBRE Market Data (2009).
Retail The Dublin retail market has seen significant declines in rental values on both the high street and in shopping centres. As of Q2 2010 prime Zone A rental levels have declined by as much as 47.5% from peak levels (Grafton Street) and although the pace of decline has slowed considerably in recent months, downward pressures remain. In the latest Q1 2010 CBRE Marketview commentary on global retail rents Dublin is now in 20th position (down 4 places from the previous quarter) In the Europe, Middle East and Africa (EMEA) region Dublin had the second highest annual fall in retail rents.
29
According to CBRE 27% of international retailers have a presence in the Irish market - Ireland ranks 32nd in terms of international retailer presence. With
regards to international retailer representation, Dublin ranks 55th out of 150 cities. The city attracted 35 international retail projects between 2007-09 including Disney, Gap, H&M and Abercrombie & Fitch (FT, FDI investment monitor 2009) Cushman & Wakefield’s annual publication ‘Main Shopping Streets’ saw Grafton Street drop from 5th most expensive street in 2008 to the 8th most expensive street in the world in 2009.
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
Re
nt
Euro
/sq
/m/y
r
Rent €/sq.m/yr for the Most Expensive Streets in the World in 2009
Source: Cushman and Wakefield, Main Shopping Streets report ( September 2009). Labour Costs As demonstrated in the NCC 2010 Cost of Doing Business in Ireland labour costs are the most significant location sensitive cost for all sectors. Labour costs are the largest cost components for services (74%) and R&D (70%). They account for 23% of total manufacturing costs. Salaries in Ireland are generally close to or above the EU averages (NCC, 2010). Irish salaries are higher than those in the US for comparable positions and for most comparable positions in the UK. However, Irish salary levels remain significantly below those in the most expensive countries (such as Denmark, Germany and Japan). They are generally a multiple of those available in Eastern Europe (Poland and Hungary) and India. The NCC also reports that at an economy wide level, Irish labour wage rates when adjusted for productivity are becoming more cost competitive.
30
More detailed analysis can be found in the most recent NCC Cost of Doing Business in Ireland report 20108.
In January 2010, some 20 countries within the EU had legislation setting the national minimum wage. Among the 20 countries and the US, Ireland had the second highest monthly minimum wage at €1,461.85 per month.
0.00
200.00
400.00
600.00
800.00
1000.00
1200.00
1400.00
1600.00
1800.00
Mo
nth
ly m
inim
um
wag
e €
Minimum wages in EU Member States and US, Jan 2010
European Commission, Eurostat
The disparity in wages shown above is greatly reduced when purchasing power parities are applied. In fact, Ireland’s position moves from 2nd to 6th place when price levels are considered – the largest change among all the countries. The CSO reported in Q2 2009 that only 1.3% of employees were receiving the minimum wage in Ireland. The average gross earnings in industry and service in Ireland in 2007 was €39,858. This placed Ireland 6th highest of the 19 countries where data was available.
8 Detailed cost comparisons are available for labour costs, property costs, utility
costs, business service costs and the broader cost environment.
0
10000
20000
30000
40000
50000
60000
Ave
rage
gro
ss e
arn
ings
€
Source: European Commission, Eurostat
Average gross earnings in industry and service, EU, 2007
31
8. DUBLIN IN THE NATIONAL
CONTEXT The Dublin City Region accounted for 28% of Ireland’s population in 2006. When combined with the mid-east, the GDA accounts for 39% of national population share.
Dublin28%
Mid East11%
Rest Of State61%
2006 Population Breakdown
Area 1996 2002 20061996%
share
2002%
share
2006%
share
Dublin 1,058,264 1,122,821 1,186,159 29.2% 28.7% 28.0%
Mid East 347,407 412,625 475,026 9.6% 10.5% 11.2%
Rest Of State 2,220,416 2,381,689 2,573,650 61.2% 60.8% 60.8%
Total 3,626,087 3,917,135 4,234,835 100% 100% 100%
Between 1996 and 2006 the Dublin City Region has been losing national population share from 29.2% to 28%. The growth of the mid-east has taken population share from the Dublin City Region over the period. Between 1991 and 2006 the population of Dublin City and Dún Laoghaire Rathdown increased by just 5.8% and 4.7% respectively. This compares with an increase of 18% for South Dublin and of 57% for Fingal County over the same period, bringing the overall increase for the Dublin City Region to 15.8%. Both Kildare and Meath experienced similar percentage increases to Fingal over the period at 51.9% and 54.5% respectively.
The Dublin City Region is the economic driver of the state accounting for 39% of economic output. When combined with the mid east it accounted for 48% of total economic output in 2007 (Regional Accounts, 2010).
Border, 7.8%
Midland, 4.0%
West, 6.9%
Dublin, 39.1%
Mid-East, 8.9%
Mid-West, 7.2%
South-East, 8.1%
South-West, 18.0%
2007 -GVA at Factor Cost across regions - Total GVA (%)
The Dublin City Region had the highest disposable income per person, at 10.8% above the State average in 2007; the comparable figure in 2000 was 16.6%.
The Place of Work Census Anonymised Records (POWCAR) dataset demonstrates that in 2006 37% of all jobs in the State were located in the Dublin City Region while the GDA was home to 45% of all jobs in the State. The administrative area of Dublin City accounted for one in five of all jobs (21%) nationally9. Census 2011 will provide a very important dataset to monitor the trends in where jobs are located, during
9 Excluding where no address in known and mobile workers.
32
the sustained period of job losses of the last number of years.
Location Percentage of All Jobs Nationally
Dublin City 20.94
South Dublin 5.99
Fingal 5.3
Dún Laoghaire Rathdown 4.73
Dublin County 36.95
Wicklow 2.09
Meath 2.41
Kildare 3.91
Mid East 8.41
Greater Dublin Area 45.36
Dublin is the knowledge hub of the state with over half of all those employed possessing a third level qualification (as opposed to 26% for Ireland). Over 50 % of all students in the university sector are based in Dublin. Over 63 % of all PhD students are based in the Dublin City Region. Applying these POWCAR proportions10 to the Q4 2009 QNHS number in employment in the state, we estimate that the total number of those employed in Dublin City Council is 396,417, in the Dublin City Region is 697,505 and the GDA is approximately 856,260. The Dublin City Region accounts for 31% of total tourism revenue in Ireland in 2009. Over 50% of all foreign direct investment (FDI) locating to Ireland between 2007 and 2009 was attracted to the Dublin City Region. The dominance of the Dublin City Region in relation to the location of Ireland’s Top 1000 companies in Ireland by turnover is clear (Irish Times, 2009). Over 58% of the top 1000 companies in Ireland by turnover are based in Dublin. Of these over half (55%) are foreign owned with 17% US, 15% UK and 4% from Germany.
10
Redundancy figures also demonstrate similar breakdowns by region.
33
9. DUBLIN INTERNATIONALLY
BENCHMARKED Dublin is now considered a truly global city and as such features in most of the international city benchmarking indices. The strength of Dublin’s brand can be seen in a report from Saffron consultants where Dublin is ranked 12th in Europe in terms of brand strength (2009). The Anholt City Brands index placed Dublin as the 29th top global city brand in 2006.
1 2 3 3 4 5 6 6 7 8 9 9 9 9 10 11 11 12 12 13 13 14 14 14 14 15
0
10
20
30
40
50
60
70
80
90
100
Sco
re a
nd
Ran
k
City Brand Strength
Score Rank
Source: Saffron Brand Consultants, European City Brand Barometer (2008). When considering the Dublin City Region in the international context it is important to recognise that Dublin is a small city region in the international scale and that we certainly outperform in relation to our size. Dublin is ranked as the 91st largest city by GDP in the world (estimated GDP 2008 of 61 billion dollars – PWC, 2010). It is estimated that the world’s top 30 cities accounted for around 18% of world GDP in 2008 and 30% for the top 100 cities.
0 200 400 600 800 1000 1200 1400 1600
Tokyo Chicago
Osaka/Kobe Sao Paulo
Buenos Aires Hong Kong
Houston Toronto
Shanghai Sydney
Phoenix Istanbul
Delhi Metro Manila
Rome Milan
Tampa/St Petersburg Busan
Cleveland Johannesburg
Kolkata (Calcutta) Bogota Athens Jakarta
Fukuoka Guadalajara
Hamburg Stockholm
Warsaw Porto Alegre
Dublin (91)Ankara
Chongqing Budapest
Global City GDP - 2008 ($bn at PPPs)
A recent OECD report (2006) on competitive cities in the global economy studies the 78 largest metro-regions in the OECD, ranging from Tokyo with close to 35 million inhabitants to Auckland with about 1.5 million. The OECD average is just over 5 million. Dublin was the second smallest of all the cities reported.
The OECD reports that ‘Budapest, Seoul, Copenhagen, Dublin, Helsinki, Randstad-Holland and Brussels concentrate nearly half of their national GDP11 whilst Oslo, Auckland, Prague, London, Stockholm, Tokyo, and Paris account for around one third. Most OECD metro-regions have a higher GDP per capita than their national average (66 out of 78 metro-regions), a higher labour productivity level (65 out of 78 metro-regions) and many of them tend to have faster growth rates than their countries.’
An upcoming report from the Office of International Relations and Research looks at the Dublin’s position in the European Context and identifies cities that have similar characteristics to Dublin12 using population, wealth, employment and growth 11
Dublin City Region is defined as the GDA in this report. 12 NUTS 3 definition of Dublin Region.
34
indicators up to 2007. The cities most closely positioned to Dublin included Amsterdam, Brussels, Munich, Dusseldorf/Essen, Geneva, Helsinki, Oslo and Zurich. A more detailed reasoning on this selection is available from the report ‘Benchmarking Dublin, Identifying Comparator cities’ Think Dublin Research Series, Cambridge Econometrics, August, 2010).
0 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000 11000
GeneveCardiff
BaselDresdenLjubljana
LeipzigTallinn
PlzenPoznan
BratislavaWroclaw
BelfastRiga
LeedsKrakow
EdinburghVilnius
BolognaMontpellier
OsloThessaloniki
BrnoPraha
ToulouseUtrecht
DublinAmsterdam
NantesOstrava
PortoZurich & Winterthur
RotterdamGlasgowHelsinki
SofiyaKoln
BruxellesKobenhavn
WienLyon
WarszawaMunchenHamburgFrankfurtBucuresti
StockholmTorino
StuttgartValencia
ManchesterLille
BirminghamBudapest
Dusseldorf and EssenBerlin
AthinaMilano
RomaStPetersburg
BarcelonaMadridLondonMoskva
Paris
Population (000's) 2007
In the European Context Dublin is placed third in relation to GDP per capita and productivity in the EU (Cambridge Econometrics European Benchmarking Database, 2010)
0 10000 20000 30000 40000 50000 60000
OstravaSofiya
BrnoPortoPlzen
ThessalonikiBerlin
VilniusMontpellier
LilleBucuresti
LeipzigValencia
BudapestManchester
Rouen and Le HavreRiga
BirminghamNantesTallinn
Aix-MarseilleGlasgow
TorinoToulouse
BelfastDresden
BarcelonaLjubljana
CardiffRoma
MadridLyon
LeedsBologna
RotterdamKoln
Den HaagDusseldorf and Essen
StuttgartEdinburgh
AthinaKobenhavn
BristolMilano
HelsinkiUtrecht
StockholmParis
BratislavaWienPraha
LondonHamburgFrankfurtBruxelles
DublinAmsterdam
Munchen
GDP per Capita (2007) (2000pps/person)
Dublin has the 22nd largest economy in Europe in terms of GDP, 37th in terms of employment and 41st in relation to employment (2007). Between 1990 and 2007 Dublin had the 9th fastest population growth. It had the third fastest GVA growth and the Second fastest employment growth against other European cities.
35
0 1000 2000 3000 4000 5000 6000 7000
LisboaGeneveCardiff
BaselWroclaw
LeipzigPlzen
TallinnDresdenLjubljana
PoznanKrakow
MontpellierRiga
VilniusBratislava
LeedsThessaloniki
EdinburghNantes
ToulouseBolognaOstrava
BrnoOslo
PortoRotterdam
UtrechtDublin
Zurich & WinterthurLyon
GlasgowHelsinki
AmsterdamPrahaSofiya
KolnBruxellesBucuresti
WienLille
KobenhavnWarszawa
TorinoHamburg
StockholmValencia
FrankfurtMunchenBudapest
BirminghamManchester
StuttgartDusseldorf and Essen
BerlinAthinaRoma
MilanoStPetersburg
BarcelonaMadridLondon
ParisMoskva
Employment 2007
0 100000 200000 300000 400000 500000
PlzenTallinnSofiya
VilniusBrno
OstravaRiga
BratislavaLjubljana
LeipzigBucurestiDresden
CardiffPorto
ThessalonikiPraha
MontpellierLeeds
BolognaNantes
BudapestEdinburgh
ToulouseGeneve
ValenciaRotterdam
UtrechtGlasgow
LyonOsloKoln
TorinoAmsterdam
LilleDublin
HelsinkiWien
ManchesterKobenhavn
BruxellesZurich & Winterthur
BerlinBirmingham
HamburgFrankfurtStuttgart
AthinaStockholmMunchen
Dusseldorf and EssenBarcelona
RomaMilanoMadridLondon
Paris
GDP 2007 (2000m Euros)
The international exposure of Ireland and Dublin is highlighted in a recent report by Ernst and Young on globalisation (2010). Ireland was ranked the third most globalised country in the world (behind Singapore and Hong Kong). Technology has been an important factor in this trend. In recent years, Ireland has positioned itself as a hub in the global exchange of technology.
7.296.9 6.87
5.82 5.77 5.77 5.62 5.45 5.16 5.14
The Globalization Index 2009
Source: Ernst and Young, The Globalisation Index (2009).
Research published by Peter Taylor and the Globalisation and world city networks (GAWC) demonstrates Dublin’s strong performance as a truly global city. In relation to the ‘new economy’ and advanced producer services sectors Dublin is an extremely well connected city internationally. The GAWC ranks Dublin as the 19th most connected city in their financial index (GAWC Dublin workshop report, April 2010) Furthermore Dublin is ranked in the top tier of globally connected cities (alpha -) according to the GAWC. The IFSC is internationally recognised and continues to hold it own against the backdrop of the financial crises. Employment numbers have remained steady at just under 25,000 over 2008-09 (Finance Dublin, 2010). However its position in the influential global financial centres index (GFCI) rankings has declined from 10th to 31st position since March 2009. This ranking relates to the competitiveness of global financial centres. Dublin’s decline can somewhat be attributed to reputation damage of the centre as a result of the economic crises. Further details are available from the report Dublin’s position in GFCI 7, Z/Yen consultants -Think Dublin Research Series, May 2010).
36
Dublin continues to be recognised as one of the most liveable cities in the world. In the Mercer 2010 ranking Dublin was ranked in the top quartile (joint 26th position) and is placed ahead of cities such as San Francisco, Helsinki, Boston, Madrid and Seattle. The top cities were Vienna, Zurich, Geneva and Vancouver. More details available in the Think Dublin Research Report ‘Mercer, Benchmarking Dublin’s Quality of Living Performance’
90
92
94
96
98
100
102
104
106
108
110
Ind
ex
Sco
re N
ew
Yo
rk =
10
0
Mercer - Quality of Living Index 2010 (Top 30)
Source: Mercer Quality of Living
In the EIU liveability ranking (August 2009) Dublin was 49th best city in the world. In the Cushman and Wakefield ‘European Cities Monitor’ (2009) Dublin is now the 18th city overall as the best city to do business in (down from 11th in 2006). The city does however continue to top the ranking on the climate that government creates for business.
0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9
London
Paris
Frankfurt
Barcelona
Brussels
Madrid
Munich
Amsterdam
Berlin
Milan
Geneva
Hamburg
Zurich
Birmingham
Düsseldorf
Manchester
Lisbon
Dublin (18)
Best City to Locate a Business (2009)
2009
2008
2007
Source: Cushman & Wakefield European Cities Monitor (Oct 2009), Sample = 500 The ‘Mastercard Global Centres of Commerce Index’ in 2008 ranked Dublin 31st out of 75 most influential cities that drives the global economy. In this report
Dublin performed particularly well in the dimension 'ease of doing business' ranking 6th just behind New York. The city ranked 37th under legal and political framework, 45th under economic stability, 6th under ease of doing business, 46th under financial flow, 40th under business centre, 39th under knowledge creation and 35th under liveability.
0
10
20
30
40
50
60
70
80
90
100
Overall 1 Legal and Political
Framework
2 Economic Stability
3 Ease of Doing Business
4 Financial Flow 5 Business Center
6 Knowledge Creation and Information
Flow
7 Livability
Rat
ing
ou
t o
f 1
00
Mastercard Centres of Commerce 2008
London (1) Amsterdam (10) Dublin (31) Barcelona (33)
Source: Mastercard, Worldwide Centres of Commerce (2008).
37
10. DUBLIN - A SMART CITY -
KNOWLEDGE AND INNOVATION
METRICS As we strive to become a truly smart city it is vital that we need to have an internationally competitive third-level sector of high quality. The match between the third level qualification and the requirements or industry in Dublin will be the key to our growth potential of these sectors. Dublin is the knowledge hub of the state with over half of all those employed possessing a third level qualification (as opposed to 26% for Ireland). Over 50 % of all students in the university sector are based in Dublin. Over 63% of all PhD students are based in the Dublin City Region. University full time enrolments 2008-09 Undergraduate Total State Dublin's %
Degrees 38,707 70,209 55.1%
Diplomas & Certificates 391 578 67.6%
Occasional 972 2,311 42.1%
Undergraduate Total 40,070 73,098 54.8%
Postgraduate
Ph. D. 3,797 5,945 63.9%
Masters (Research) 1,028 1,543 66.6%
Masters (Taught) 3,799 6,579 57.7%
Postgraduate Dip. & Cert. 2,150 4,028 53.4%
Occasional 8 33 24.2%
Postgraduate Total 10,782 18,128 59.5%
Full-time Total 50,852 91,226 55.7%
Source HEA (2009) The World ranking of both Trinity College Dublin and UCD has improved dramatically, according The Times Higher Education/QS World University Rankings. Trinity was 43rd in the rankings and is the only Irish third-level institution to make it into the elite top-50 group. UCD is now ranked 89 worldwide. UCD and Trinity are the only Irish third-level colleges in the top 100. Dublin's Michael Smurfit School of Business retains its 98th rank for its MBA (EIU 2009 Global MBA rankings) In the NCC Annual Competitiveness Report 2010, it is reported that Under the 7th Framework Programme
for EU research and development, Irish researchers were as likely to be successful in their applications for competitive funding (21.8%) as the euro area average (21.4%) However, Irish researchers attracted significantly less funding per applicant than leading countries such as Finland, Germany and Denmark. This is a useful indicator as countries that are successful in attracting competitive research funding are likely to have a good quality research eco-system.
While Ireland’s performance in innovation metrics is improving we still have a long way to go to catch up with out key competitors in this area. In the Huggins (2008) world knowledge competitiveness index the SE region of Ireland is ranked 81st a long way off the top regions of San Jose, Boston and Stockholm.
0 50 100 150 200 250
San Jose-Sunnyvale-Santa Clara, US
Boston-Cambridge-Quincy, US
Hartford, US
Bridgeport-Stamford-Norwalk, US
San Francisco-Oakland-Fremont, US
Stockholm, Sweden
Seattle-Tacoma-Bellevue, US
Providence-Fall River-Warwick, US
Tokyo, Japan
San Diego-Carlsbad-San Marcos, US
(81) Southern and Eastern, Ireland
World Knowledge Competitiveness Index 2008 - Top 10 and Dublin's Position
Source: Centre for International Competitiveness, WKCI (2008).
The Southern and Eastern region was particularly strong for sectoral employment per capita in certain knowledge intensive sectors such as IT and Computer Manufacturing, High Tech Services, Biotech and Chemicals, Instrumentation and Electrical Machinery. However it fared particularly poorly in relation to knowledge capital and knowledge sustainability components.
38
Ireland is ranked 7th in the 2008 EU innovation index just above the EU average. However we are still behind Switzerland, Finland and Denmark, UK and Austria (all innovation leaders). The scoring mechanism labels Ireland as an ‘Innovation Follower’. There has been little change in Ireland’s score in this index since 2005
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
Inn
ova
tio
n I
nd
ex
Summary Innovation Index 2008
Source: European Commission, Innovation Scoreboard (2009).
R&D Ireland’s expenditure on R&D has increased between 1997 and 2008, from 1.27 % of GNP to 1.42 % of GDP. This compares with an EU average of 1.9 % in 2007. Ireland is making only limited progress towards the EU 2020 target of 3 %. Eurostat figures on R&D expenditure show Irelands 2008 performance a long way of leading performers such as Sweden, Finland, Japan and the US. Foreign-owned companies undertake most business expenditure on R&D in Ireland (73%), NCC Ireland’s Competitiveness.
1.27 1.24 1.18 1.12 1.1 1.1 1.17 1.24 1.25 1.3 1.311.43
1.78 1.79 1.84 1.85 1.86 1.87 1.86 1.82 1.82 1.85 1.85 1.9
2.56 2.59 2.65 2.73 2.752.65 2.64 2.57 2.61 2.65 2.67 2.762.7
2.87
3.163.35 3.3 3.36 3.43 3.45 3.48 3.45 3.47
3.72
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
R&D Expenditure as a proportion of GDP
Ireland European Union (27 countries) United States Finland
Source: Eurostat (2008), Science and Technology Indicators.
All the leading indicators for R&D demonstrate how far Ireland is lagging behind the top performing
countries of Sweden, Finland, Japan, US and Denmark on levels of R&D activity.
0
0.5
1
1.5
2
2.5
3
3.5
4
R&D Expenditure by all sectors, as % of GDP, 2008
0
0.5
1
1.5
2
2.5
3
Swe
de
n
Fin
lan
d
Jap
an
De
nm
ark
Au
stri
a
Un
ite
d S
tate
s
Ge
rman
y
Ice
lan
d
Be
lgiu
m
Luxe
mb
ou
rg
Fran
ce
EU-2
7
Un
ite
d K
ingd
om
Slo
ven
ia
Ire
lan
d
Cze
ch R
ep
ub
lic
Ne
the
rlan
ds
No
rway
Po
rtu
gal
Spai
n
Ital
y
Esto
nia
Hu
nga
ry
Cro
atia
Mal
ta
Turk
ey
Slo
vaki
a
Lith
uan
ia
Po
lan
d
Ro
man
ia
Gre
ece
Bu
lgar
ia
Latv
ia
Cyp
rus
Business Expenditure R&D as a % of GDP, 2008
Source: Eurostat (2008), Science and Technology Indicators
One area of progress has been in the area of higher education expenditure on R&D which has seen a continued increase in spend over recent years increasing from 153 million in 1996 to 601.4 million in 2006. However despite this Ireland still ranks just below the EU average.
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
Swe
de
n
De
nm
ark
Ice
lan
d
Au
stri
a
Fin
lan
d
Esto
nia
Ne
the
rlan
ds
Po
rtu
gal
No
rway
Un
ite
d K
ingd
om
EU-2
7
Ge
rman
y
Lith
uan
ia
Jap
an
Be
lgiu
m
Fran
ce
Ire
lan
d
Ital
y
Spai
n
Turk
ey
Un
ite
d S
tate
s
Gre
ece
Latv
ia
Cro
atia
Cze
ch R
ep
ub
lic
Cyp
rus
Hu
nga
ry
Slo
ven
ia
Po
lan
d
Mal
ta
Ro
man
ia
Slo
vaki
a
Bu
lgar
ia
Luxe
mb
ou
rg
2008 Higher Education Expenditure on R&D as % of GDP
Source: Eurostat (2008), Science and Technology Indicators
39
0
0.05
0.1
0.15
0.2
0.25
0.3
0.35
0.4
0.45
0.5
Ice
lan
d
Ge
rman
y
Slo
ven
ia
Fran
ce
Fin
lan
d
Bu
lgar
ia
Un
ite
d S
tate
s
Jap
an
Cze
ch R
ep
ub
lic
Spai
n
Luxe
mb
ou
rg
EU-2
7
Ro
man
ia
No
rway
Hu
nga
ry
Cro
atia
Ne
the
rlan
ds
Po
lan
d
Lith
uan
ia
Be
lgiu
m
Latv
ia
Swe
de
n
Ital
y
Un
ite
d K
ingd
om
Esto
nia
Slo
vaki
a
Au
stri
a
Gre
ece
Po
rtu
gal
Cyp
rus
De
nm
ark
Ire
lan
d
Turk
ey
Swit
zerl
and
Mal
ta
2008 Government Expenditure on R&D as % of GDP
Source: Eurostat (2008), Science and Technology Indicators
Patents Patents can be taken as a reflection of a country’s inventive activity. Ireland performs very poorly in the number of patent applications in the European and US patent offices. Its performance is behind the EU average and is a long way off that of Switzerland, Germany, Sweden and Finland.
Ireland, 65.33
European Union,
114.91
Netherlands, 205.75
Finland, 247.34
0
50
100
150
200
250
300
Nu
mb
er
app
licat
ion
s p
er
mill
ion
in
hab
itan
ts
European Patent Office - Patent Applications
Source: Eurostat (2008), Science and technology Indicators
0 200 400 600 800
LiechtensteinSwitzerland
Germany SwedenFinland
Luxembourg Netherlands
DenmarkAustria
JapanBelgium
FranceUnited States
European UnionNorwayIceland
United KingdomItaly
CanadaIreland
SloveniaSpainMalta
CyprusHungaryPortugal
Czech RepublicGreece
LatviaCroatia
SlovakiaEstoniaPoland
BulgariaLithuania
TurkeyRomania
2005 - EU patent applications. Number of patents per million inhabitants
Source: Eurostat (2008), Science and technology Indicators
40
11. THE BROADBAND CHALLENGE
FOR DUBLIN While general broadband penetration levels continue to improve in Ireland and Dublin there is still a major issue with speed/quality and cost considerations. Challenges currently exist in relation to the upgrading of outdated networks and fibre infrastructure in the city. The main growth in broadband is a result of increasing usage of the mobile 3G devices which have limitations in the speed and quality of connection on offer. The proportion of households with a broadband connection at 54 % in 2009 (Eurostat) is still a long way compared to the likes of Finland (74%) and the Netherlands (77%) and Denmark (80%)
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
Sub
scri
be
rs p
er
10
0 In
hab
itan
ts
OECD Broadband Subscribers per 100 inhabitants, by technology, June 2009
DSL Cable Fibre/LAN Other
Source: OECD, Broadband Statistics (June 2009).
0
200000
400000
600000
800000
1000000
1200000
1400000
1600000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2007 2008 2009
Tota
l Su
bsc
rip
tio
ns
Irish Broadband Subscriptions by Mode of Access, 2007 - 2009 Q3
DSL Fixed Wireless Access Other (Incl. Satellite and Fibre) Cable Mobile
Source: Comstat.ie, Irish Internet Subscriptions (2009). Broadband quality/speed and cost issues have been identified as major challenges for Dublin in relation to its international competitiveness. Ireland is well off the pace when average country download speeds are compared.
1 2 3 4 5 6 7 8 9 10 11 12 13 14
48
0
10
20
30
40
50
60
0
5
10
15
20
25
30
Ran
k
Spe
ed
Countries by Download Speed and Rank
Speed Rank
Source: Speedtest.net (2009). According to the European Comission, Digital Competitiveness Report, May 2010. 20% of fixed connections in the euro area-14 are now above 10 Mb/s compared to only 9% in Ireland – a much lower proportion than leading EU countries such as Portugal (61%), Belgium (41%) and Denmark (35%). A recent evaluation of the digital hub by Euricur (2010) identified the issue of broadband speeds/quality and associated costs as a serious challenge for the companies operating there. The report quotes that: “There is a need to future proof the broadband offer in The Digital Hub to remain competitive
as new technologies and usage patterns emerge”. It has also been highlighted that there is a real gap in broadband infrastructure provision in the less affluent areas of the city such as the Liberties. (Euricur & Dublin City Council, Digital Hub Case Study, 2010) In relation to costs for accessing higher broadband speeds Ireland compares poorly with the EU-14 average and Dublin is still an expensive location for broadband services on a per megabit basis; at $16.31 per megabit, the cost in Ireland is significantly higher that the OECD – 28 average of $7.24. (NCC, 2010) Future trends identified in web usage point to a requirement for increasing bandwidth requirements. The growth of High definition Video combined with the increasing number of services delivered online will require a sufficient broadband infrastructure in the city. This will ensure that Dublin can position itself as a world leader in the creating of content,
41
test bedding of new technologies/solutions and selling these services to an international market. A recent report from Cisco / University of Oxford (2009) demonstrated that Ireland is still a broadband mediocrity appearing 16th out of the top 20 countries worldwide. It also stated that Dublin city is now ranked in 86th place for the quality of its broadband. Cities ranked ahead of Dublin include Ankara, Ljubljana, Bratislava, Talinn, Budapest, Sofia, Vilnius, Riga, Prague, Athens and many Chinese cities.
0 10 20 30 40 50 60 70 80 90
Dublin (86)ToulouseAntwerp
ViennaBrussels
VancouverBerlin
LyonPorto
FrankfurtTampere
BergenPrague
Paris Budapest
LisbonHelsinki
HamburgLjubljana
Oslo Bratislava
GenevaMarseilleNew YorkDen Haag
ChicagoTaichung
Saint PeterburgOulu
MoscowAmsterdam
KolnKosice
GoteborgTokyoZurichVilnius
StockholmBucharest
CopenhagenRiga
RotterdamSofia
UppsalaOsaka
MalmoSeoul
SapporoKaunasNagoya
Yokohama
Top 50 cities – CISCO Broadband Quality Score -download/upload/latency
Dublin competitor cities Amsterdam and Stockholm have invested heavily in city-wide fibre-optic networks. Asian cities as well as some of the emerging Eastern European cities are well ahead of Dublin with regards to broadband infrastructures. It is clear that we need to identify opportunities to deliver a world class broadband infrastructure for Dublin. There is an urgent requirement to address the broadband challenge in the city.
42
12. DUBLIN – A GREEN AND
SUSTAINABLE CITY Increasingly cities are being ranked in relation to their green and sustainability performance. The Siemens Green City Index13 (EIU, 2010) really contextualises Dublin’s performance against other capital cities across Europe. Cities that perform well as Green and sustainable cities are more often ones that offer an excellent quality of life experience for residents of the city. Overall Dublin was ranked 21st overall in the European Green City Index, with a score of 53.98 out of 100. Its results are strong in the air quality category (4th), where it ranks fourth overall, but poor showings in other categories, including transport, energy, buildings and carbon dioxide (CO2) emissions, pull down its overall score. The cities that Dublin can learn from include Copenhagen which is the “greenest” major city in Europe, followed by Stockholm, Oslo, Vienna, and Amsterdam.
0 20 40 60 80 100
(1) Copenhagen Stockholm
Oslo Vienna
Amsterdam Zurich
Helsinki Berlin
Brussels Paris
London Madrid Vilnius Rome
Riga Warsaw
Budapest Lisbon
Ljubljana Bratislava
(21) Dublin Athens Tallinn Prague
Istanbul Zagreb
Belgrade Bucharest
Sofia Kiev
Overall Green City index ranking (2010)
Source: EIU and Siemens, European Green City Index (2009).
Summarising some of the key findings of this research include:
13
Referenced from the Siemens Green City Index 2010.
Co2 Emissions: Dublin ranks 19th producing 9.72 tonnes of CO2 per head annually, nearly twice the 30-city average of 5.2 tonnes. Energy: Dublin ranks 18th, largely because of its poor performance in the energy consumption subcategory. The vast bulk of Ireland's electricity comes from fossil fuels. Each inhabitant of Dublin consumes 156 gigajoules per year, compared with a 30-city European average of around 81 gigajoules. Our over dependency on imported energy is a real concern for the city and country. Deployment of smart grids, smart meters and a move towards the exploitation of renewable energy sources is a prerequisite for Dublin and Ireland to maintain its future levels of international competitiveness. Buildings: Dublin ranks 24th -residential and commercials buildings account for 55% of the city’s total greenhouse gas emissions. Real opportunities exist for retrofitting social housing stock in the city. Water: Dublin ranks joint 16th. The city’s residents each consume about 128 cubic metres of water per year, substantially above the index average of 105 cubic metres. Waste & Land Use: Dublin ranks 13th helped by a strong score in the waste recycling and reuse subcategory. About 28% of waste is recycled, above the 30- city average of nearly 18%. A challenge for Dublin relates to the 656 kg of waste per inhabitant per year, well above the average of 511 kg (excluding industrial waste). Transport: Dublin is ranked last in the transport category — its worst performance in the index. This is an area that is universally accepted as one of the cities biggest challenges. Both the length of its public transport network and the extent of its cycle lanes are well below the index average. The challenge of increasing public transport usage to work and reducing the dependency of cars will depend on the successful implementation of the Dublin elements of the Transport 21 initiative. There can be no rolling
43
back on the Dublin Metro or Dart interconnector projects. The issue of Public transport deficit has also been directly highlighted by Mercer in a recent Dublin centric study on international quality of living benchmarking. This was undertaken in collaboration with the Office of International Relations & Research (Think Dublin Research Series, August 2010).
0 2 4 6 8 10
Stockholm Amsterdam
Copenhagen Vienna
Oslo Zurich
Brussels Bratislava
Helsinki Budapest
Tallinn Berlin
Ljubljana Riga
Madrid London Athens
Rome Kiev Paris
Vilnius Zagreb
Istanbul Warsaw
Lisbon Prague
Sofia Bucharest
Belgrade (30) Dublin
Transport
Source: EIU and Siemens, European Green City Index (2009).
0 2 4 6 8 10
Berlin Stockholm
Oslo Copenhagen
Helsinki Amsterdam
Paris Vienna Zurich
London Lisbon
Brussels Vilnius
Sofia Rome
Warsaw Madrid
Riga Ljubljana Budapest Bucharest
Athens Bratislava
(24) Dublin Zagreb Prague
Belgrade Istanbul
Tallinn Kiev
Green Cities "Buildings overall ranking
Source: EIU and Siemens, European Green City Index (2009).
44
13. FEEDBACK The preceding report is in draft format. We would welcome any comments or suggestions on the content, data or sources utilised. Detailed spreadsheets containing the data behind the charts and graphs in the report are available on request. The data will continue to be up-dated as it becomes available. We are aware that there are a number of information gaps relating to the Dublin City Region, for example detailed sectoral performance, which we hope to address in collaboration with the relevant bodies across the city. Jamie Cudden, Research Manager [email protected] Helen O’Leary, Research Officer [email protected]
ACKNOWLEDGEMENTS
The indicators referenced in this report are sourced from a number of third party sources. We would like to thank the various data providers that we have collaborated with to source the relevant indicators and research. In particular CBRE Dublin, CSO for providing us with custom extracts of the QNHS, Cambridge Econometrics, Z/Yen, Mercer, Dublin Tourism, Dublin Port and Forfas/NCC.
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DUBLIN CITY COUNCIL – THINK DUBLIN! RESEARCH SERIES
Q2 2010
O F F I C E O F I N T E R N A T I O N A L R E L A T I O N S A N D R E S E A R C H