The National Competitiveness and Productivity Council has published its annual Challenge Report, which outlines some of the key issues facing the economy.
Chair of the Council Dr Frances Ruane said “failure to develop and implement appropriate policies now to address new developments, including decarbonisation and tipping points in digital technologies, could leave Ireland in a laggard position in the years ahead”.
The report draws attention to the lack of competition in some parts of the economy, like banking, where there are now only two full-service banks operating.
It highlights legal costs and repeats what it describes as a “longstanding recommendation” to establish “a specialist conveyancer profession” to take advantage of digital reforms in this area and bring down legal costs.
On competition, it recommends the Competition and Consumer Protection Commission engage in analyses of local level competition to ensure that markets in goods and services work across the country.
On the labour market, the report acknowledges reforms in recent years like statutory sick pay and a commitment to a living wage. However, it warns this may push up costs and therefore prices in some sectors like hospitality and retail.
It has also identified the need to develop policies to entice back into the workforce older male workers currently with lower education and skill levels.
It found the number of men between 50-64 with lower levels of education who are active in the workforce has fallen from approximately 97,000 in 2013 to 77,000 in 2022, a reduction of 21%. This is despite the number of men overall in this age cohort increasing by 32% over the same period.
The report also identifies the need to invest in planning to deliver ‘at scale’ the level of offshore renewable energy required to reverse Ireland’s position as a laggard when it comes to renewable energy.
The report goes into some detail on the changes in industrial policy in the US and the EU which is seeing large-scale support for renewable energy industries and computer chip investment that risks putting smaller economies like Ireland at a disadvantage.
The report recommends that Ireland focuses its efforts on supports for break-through technologies like A.I. and quantum computing.
It also recommends that when it comes to infrastructure, the Government may also need to prioritise what it wants done. This is particularly the case as the economy continues to enjoy full employment.