IDA Ireland marks four decades of US West Coast success

This year, Ireland celebrates its 50th year anniversary as a member of the EU and, here on the West Coast of the US, we have just marked our 40-year anniversary of IDA Ireland’s West Coast operations. 

It is an opportune time to reflect on what Ireland has achieved in those decades and what the future might hold. While Ireland has not been immune to issues in the global economy such as inflation, supply chain disruption and the impact of the global slowdown in the tech sector, we continue to be a location of choice for new investors and long-established companies from the West Coast, such as Apple, Google, Microsoft, Intel, Amazon, and Salesforce, all of whom have a significant presence in Ireland.

The trade and investment relationship between the EU and the USA is the largest bilateral such relationship in the world. Total trade with the US was estimated at $1.2tn in 2021. Ireland is a key part of this relationship. CSO's figures for 2021 show total trade between Ireland and the US of approx. €255.5bn.

 Today, about 280 West Coast companies directly employ more than 70,000 people in Ireland in technology, business services, life sciences and financial services. IDA’s West Coast region spans 11 states and incorporates key business hubs like San Francisco, San Jose, San Diego, Seattle, Salt Lake City and other locales. In fact, according to a Bloomberg report, California is poised to become the world’s fourth-largest economy.

From this region last year, we saw Intel announce an investment of €12 billion in a “Fab 34” facility in Ireland. This investment is on top of the €5 billion previously announced and brings the overall investment by Intel on its campus in Leixlip to €30 billion. 

This is a significant statement of confidence in Ireland and an endorsement of our talented and skilled workforce. Apple first established operations in Cork in 1980, investing and reinvesting for the past 41 years. They presently employ some 6,000 people and, last year, Apple announced that it is to further expand its operations in Cork with the addition of a new campus building that will afford it extra capacity to accommodate 1,300 employees.

The inflation factor The general economic consensus here in the US is that we have reached peak inflation, and although some of our clients continue to reduce costs, Ireland continues to attract new investors while long-established companies chose to reinvest in substantial expansions of their operations here.

The job losses announced in recent months are regrettable and IDA’s thoughts are with those who have lost, or are in the process of, losing their jobs. It is important though, to reflect on what has happened in the global tech sector in 2022 and what has caused the retrenchment. We saw a significant surge in growth and hiring during the pandemic and in the immediate aftermath. The post-pandemic environment has seen a surge in inflation, rising interest rates and reduced access to capital.

 The narrative has flipped from growth to profits, and valuations for tech companies have decreased significantly. This has resulted in companies closest to the consumer reducing costs in response to these challenges and we will likely continue to see challenges in the coming months. However, it is important to note that companies that have announced a global reduction in their headcount have effectively stepped back their employment numbers to where they were as little as nine months earlier. The technology sector in Ireland has been building for over 60 years and will continue to grow in the future, despite these current challenges.

Our regional focus The underlying strength in the technology sector is driven by a number of factors, including the pace of digitalisation across all sectors and the associated need for new digital infrastructure and services. As a native of Clare, I was proud to see Edwards Lifesciences, a Californian company establish its operations in Shannon in 2018 and announce 600 new jobs for the Mid-West region. The company has since doubled its investment in Limerick from €80m to €160m and added another 250 roles onto the previously announced 600, promising 850 new jobs by 2025.

The Advance Manufacturing Centre (AMC) in Limerick, a strategic national initiative supported by the Irish Government through IDA Ireland is a world-class, purpose-built facility which will support job retention, transformation and next-generation manufacturing investment for Ireland. The continued investments across regional locations demonstrate our continued focus on balanced regional development throughout Ireland. Indeed, our results announced in December last bear this out as 52% of our 242 investments went to regional locations, with employment growth in every part of the country.

Expansion in Irish operations Having recently taken up the role of West Coast Director for IDA Ireland, the focus has been on developing and growing our in-person engagements. The IDA team pivoted seamlessly during the pandemic to a virtual model so that business could continue — we showed great resilience in 2021 and 2022 which were bumper years for growth. In this period, approximately one company announced expansion in Ireland from the West Coast every 2/3 weeks.

US companies use Ireland as an entry point to the EU, the world’s largest single market of 550m people with a workforce of 250m. In Ireland, they gain access to a highly skilled, English-speaking and flexible workforce - leading to the growth we saw in 2022 - with 242 new investments, including, from West Coast companies such as:

• NetApp opening their new international headquarters in Cork with the creation of 500 jobs by 2025.
• Workday, headquartered in the Bay Area, announcing 1,000 new jobs over the next two years at its European headquarters in Dublin.
• Okta, a top identity and access management company based in San Francisco, opening a new office in Dublin’s Docklands, where it intends to create 200 new jobs by 2024.
• MarketStar from Utah, announcing a new location for its EMEA headquarters in Dublin with plans to create up to 300 new jobs over the next three years, bringing its local team to 500 by 2025.

Foreign direct investment (FDI) has been transformational for Ireland over the last 70 plus years. Ireland is in an enviable position amongst our European partners due to the level of our success in attracting FDI. In 2022, IDA Ireland reached a significant milestone with over 300,000 people in Ireland directly employed in multinational sector. This is the highest FDI employment level ever.

I am confident over the next number of decades that, at IDA Ireland, we will continue to build on our success and investments with companies from the West Coast of the US a key part of this success.