ERF: Investment needed to build labour market skills

31st August 2023

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Updated / Thursday, 31 Aug 2023 13:38

ERF: Investment needed to build labour market skills

The Employment and Recruitment Federation is calling for employment taxes that attract and reward workers, as part of its Budget submission.

It wants to see investment in building labour markets skills and re-skilling, to address what it calls a growing crisis in the Irish economy's 'talent' space.

Donal O'Donoghue, President of the ERF said most employers, including the public service sector, are finding it difficult to recruit, with unemployment at its lowest since 2001 at 4.1%.

"We have insufficient affordable housing, childcare provision, and public services in sectors like healthcare and education," Mr O'Donoghue said.

"These social issues are a product of the talent shortage, and are also, in turn, major contributors to the diminishing workforce," he added.

The ERF has said the work permit and visa system needs further simplification and reform, to address skills shortages.

It also recommends investing in English language training for migrants seeking employment, to improve their employability and integration in the workforce.

"Our ability to attract back the non-Irish nationals who departed during Covid, along with younger Irish nationals who emigrated, and to generate new inward migration, is severely impacted by the cost of living, housing and, for some, childcare," Mr O'Donoghue said.

"Investing some budget surplus in social issues will take the pressure off the labour market and help restore competitiveness in Irish industry," he added.

In terms of tax, the ERF said Ireland's high marginal personal tax rates, especially for top earners, is hindering economic growth and talent attraction.

It said recruiters believe reducing the overall level of the 52% marginal tax rate, and revising the entry point before it applies, will make Ireland more competitive on the global talent stage.

In its pre-budget submission, it also said it is "vital" to broaden the tax base.

The submission calls for a five-year roadmap for reform of income tax code, PRSI code, and Universal Social Charge (USC), to reassure employers and support FDI.

"Reducing the number of PRSI classes, capping PRSI for employees and employers, and introducing automatic indexation based on inflation, is essential to maintain real value," Mr O'Donoghue said.

He also said they believe the income tax credit for STEM third level programmes should be enhanced, to foster innovation and growth in that area.

"Removing the cap on the credit, and making it available at the individual's marginal rate, for all STEM courses, will encourage more people to pursue these critical disciplines," he said.

The ERF said there are growing concerns among businesses about increased labour costs.

In terms of increased labour costs, the ERF said there are growing concerns among businesses.

"The potential additional cost implications of Government proposals for a new living wage, a possible 12.4% increase in the national minimum wage from 2024, pensions auto-enrolment, the recent legislation on statutory sick pay, a new public holiday from 2023 and other statutory leave changes, could reasonably increase the average wage bill by up to 10% by 2030", Mr O'Donoghue said, claiming that, in domestic sectors like retail and logistics, pensions auto-enrolment and living wage costs could have a significantly higher impact.

Ireland’s launch of the world’s only degree level course for recruiters, in 2020, has seen Geraldine King, CEO of the Employment & Recruitment Federation here (ERF), included in this year’s prestigious SIA 2022 European Staffing 100 listing.

The Irish recruitment industry representative developed the first ever degree-level qualification for recruiters, which is delivered by the IFSC-based, National College of Ireland. 2020 and 2021 graduates successfully completed their college programme, which was facilitated largely online, during the pandemic.

The course involves blended learning and operates in an apprenticeship model, with hands-on recruitment work interspersed with study. It is Government-funded, and recruitment agencies or companies pay a registration fee for each apprentice enrolled.

A recognised degree qualification is hugely significant for standards in recruitment, for career development, and for confidence in the sector, according to Geraldine King.

“Ireland’s initiative drew huge global interest across the recruitment sector, and, on behalf of the ERF team, I am honoured the SIA acknowledged our achievement on their Staffing 100 list.

“It is important for uniform standards across the industry, and provides a qualification that gives a competitive edge and reassures clients of the professionalism of recruitment professionals”, King says.

A Masters qualification is also now on the cards for Ireland’s recruiters, developed and overseen by the ERF too.

Geraldine King runs the Employment & Recruitment Federation, having joined it in 2009. As CEO, she has continued to facilitate services and expand the federation’s education and upskilling offering.

Regarded as a catalyst for change in recruitment, King introduced an accredited Certificate in Recruitment Practice initially, as well as the degree level programme. She introduced upskilling courses that are delivered via Skillnet and, during the pandemic, facilitated the ERF ‘Keep Ireland Working’ helpline, connecting agencies to candidates who had lost jobs, and supporting rapid recruitment in sectors under pressure.

An executive board member at the World Employment Confederation, King has lobbied Government on labour market issues like barriers to women’s participation, investment in education and skills, and inequitable contracts.

Having been on the MBA interview panel at DCU (Dublin City University), a member of Fingal Chamber of Commerce board of management and an adjudicator for industry awards across Europe, Geraldine King was awarded Ireland’s James Kilbane Award for outstanding contribution to the recruitment industry in 2018. She has an MSc in Human Resource Management.

For Information:

SHARON BANNERTON ¦ Managing Director, BANNERTON ¦ Mobile: + 353 87 673 1100 ¦ Email: Sharon@BANNERTON.ie