Need for a debate on the economy…

Interesting statement from Stephen Kingon, pointing out that with government spending set to dip, and 300% increase in the long term sick rate, Northern Ireland is long overdue a wide ranging debate on the challenge raised by developing a more flexible economy.

  • smcgiff

    Manufacturing is a 20th century economy. In an advanced/high wage economy people intensive manufacturing is over. Look no further than the textile industry.

    In high wage Europe, R&D and the high value add services are your only man.

  • IJP

    You know Seamus, until about 3 months ago I’d have agreed 100%.

    However, that’s not entirely correct. Countries such as China will soon be forging ahead because they combine both manufacturing and knowledge. We in the West have a temporary advantage because knowledge is worth more, but once China and others secure that knowledge (and they are already doing so – the Chinese for example have just bought an arm of IBM, the full works, including the know-how that goes with it) they will leave us behind.

    That said, the key is that local businesses do the manufacturing, not necessarily that the manufacturing is done in NI. The point is that knowledge and manufacturing must be able to be combined by firms here – where geographically that is carried out is almost irrelevant, as long as the profit and advancement ends up here.

    I strongly welcome any debate on the economy – we spend far too long debating social policy without even considering the potential for a liberal but well-regulated advanced economy to turn our region around. After all, we haven’t exactly got too far to look for an example…!

  • smcgiff

    Yip, China is going to be a real player soon, and it is only a matter of time before it is a full member of the G7(8) group.

    I also agree that they bought IBM’s PC division for a song. I’m even more surprised they were allowed to do so.

    Not alone China, which will take decades before it is no longer a very low cost economy, but there will always be an India or possibly even an emerging Africa to supply cheap and educated labour.

    I’m in less of agreement with you as to it not mattering where the work is carried out if the companies are owned in NI.

    As you know, the ROI is doing quite nicely out of Multinationals, but even those in the High Tech sector with high people input are in danger of being lost to Eastern Europe. My former employer, Dell comes to mind.

    With that said, what kind of industry could be enticed (either externally or developed from within) into the NI economy with a mammoth public sector earning a relatively high wages?

  • Henry94

    The idea of Northern Ireland debate about the economy is a bit like eunuchs discussing the Karma Sutra, entirely theoretical.

    The only line we can take is a line from Oliver Twist “Please Sir, can we have some more”

    The north will never prosper. It has neither the wage structure nor the demographic profile required. Nor does it have the freedom to make any real economic decisions.

    Throw in the political mess and you have a development repellent society.

    We’re effectively on the dole, a failed society. Even the bright people who post here all day clearly do no real work

  • smcgiff

    ‘We’re effectively on the dole, a failed society. Even the bright people who post here all day clearly do no real work’

    Ah, so you do have a sense of humour, Henry, but remember that not everyone posting on Slugger is from Norn Iron.

  • Fraggle

    Isn’t it great that when there is such a need for a debate on the economy, few can be bothered to debate it even on a site like this.

    I find it shocking that 1/2 of employees work in the public sector. Does anyone have any stats comparing that figure with britain, the republic (of ireland) or mainland countries?

    I’d hazard a guess that a third (or a turd if you’re from dublin) is too high. Think of all the people who take up these excess, unproductive jobs in the civil service and so on. They could be engaged in something productive which creats wealth rather than simply spending english money. If i were british (from britain), I’d want shot of the lot of us in NI.

  • IJP

    Actually Seamus, we are in agreement. My point was that multinationals are all alright while the world economy’s on an upward trend, but you need the local back-up for when it’s not. We await with interest a global downturn to see how the Celtic Tiger deals with it – but my view is that a well-educated, flexible workforce with significant ‘indigenous business’ development having followed on from the initial investment will do OK.

    With that said, what kind of industry could be enticed (either externally or developed from within) into the NI economy with a mammoth public sector earning a relatively high wages?

    That is the point. The problem is it requires: a) the public sector to realize that (hardly likely since the people who work in it gain from it!), or b) the political will to change it (hardly likely since we’re too busy debating the colour of lilies and languages on ATMs).

    Point is, we can’t change a), therefore we must change b).

    Henry

    People were being just as defeatist about the Republic until the early 90s! There is nothing in NI’s demographic or geographical profile that makes it any different from the Republic, Singapore or Luxembourg – all former economic basket cases come good.

    Even the bright people who post here all day clearly do no real work

    Speak for yourself! :)))

    Most definitely does not apply to me (I’ll leave you to work out which bit doesn’t apply to me…)

    Fraggle

    Isn’t it great that when there is such a need for a debate on the economy, few can be bothered to debate it even on a site like this.

    A very good and telling point. If the thread had ‘Ulster Scots’ in the title it’d be 106, not 6!

    Does anyone have any stats comparing that figure with britain, the republic (of ireland) or mainland countries?

    Firstly, full marks for the term ‘mainland countries’, too bloody right!!!

    I hesitate to comment without sources, but I’m fairly sure I’m right when I say that 40% of the NI workforce works directly for the public sector, and another 25% works for what is known as the ‘pseudo-public sector’ (i.e. not directly for the public sector, but their work is directly dependent on it, e.g. a consultant to a Government department). I do not know whether these figures include employment in state-funded community- or voluntary-sector organizations – in fact, I suspect worryingly that they don’t.

    In the UK as a whole comparative figures would be around 25% and 40%. I’d say it would be similar in the Republic. As an educated guess, I would suspect this figure would be more like 33% and 50% in many continental European countries where the culture is more that the state is a legitimate source of employment rather than merely a necessary one. (Mind, I’m always fond of quoting the point that Rome built an Empire without any Civil Service at all!)

    They could be engaged in something productive which creats wealth rather than simply spending english money.

    A lot of people will accuse you of being too simplistic here… but in fact you’re not!

    If i were british (from britain), I’d want shot of the lot of us in NI.

    Likewise if I were ‘Irish (from RoI)’ I’d want nothing to do with us!

    In fact the extra spending for NI is not a drop in the water compared to the entire UK budget – it costs more to maintain troops and ‘influence’ in Iraq, for example. This is why NI gets away with it.

    My point is, and has always been, that this extra unnecessary employment is bad for NI, because its most-talented people leave and seek ‘proper’ wealth-creating posts elsewhere thus rendering effective wealth creation impossible (again we have an example of how to do the opposite only a few miles/km down the road). I’m clearly speaking, therefore, as one of its least-talented…!

  • IJP

    In fact the extra spending for NI is not a drop in the water compared to the entire UK budget

    Sorry, remove the negative – the extra spending for NI is a drop in the water.

    Off now to find a state-funded voluntary-sector organization to which 15 Civil Servants plus 3 external consultants are responsible to meet my basic human right to learn how to type…

  • DessertSpoon

    I left NI to go to University and because of the lack of any opportunities in NI I stayed away. Then in 2000 I came back for a number of reasons but one of them was the foolish assumption that maybe NI would start to go somewhere economically and politically. 5 years laters some economic improvement but mostly superficial and some but not nearly enough political movement and perhaps now a return to stagnation. Time to start looking elsewhere for good this time!

  • Henry94

    IJP

    I would definitely put you in the bright category and I’ll take your word about the work

    People were being just as defeatist about the Republic until the early 90s!

    That is true but there is an important difference. The south changed its policies. The north doesn’t have control.

  • Donnie

    I’m just glad there is something on Slugger other than the Northern Bank/SF/IRA! However, I’m much too busy creating wealth (for my employer, not me!) to comment at length. Maybe later……

  • Gerry O’Sullivan

    Fraggle wrote: “Isn’t it great that when there is such a need for a debate on the economy, few can be bothered to debate it even on a site like this.”

    IJP replied: “A very good and telling point. If the thread had ‘Ulster Scots’ in the title it’d be 106, not 6!”

    Actually, there was a lengthy debate (over 200 posts) about the NI economy here last October/November. Quite a lot of it was a robust exchange of views between George and Willowfield regarding public sector v. private sector employment and their relative values to the economy.

  • Ringo

    Fraggle –
    I find it shocking that 1/2 of employees work in the public sector. Does anyone have any stats comparing that figure with britain, the republic (of ireland) or mainland countries?

    reminds me of a friend of mine starting work in a company in Galway – making polite chat on day one with his supervisor he asked him ‘how many people work here?’ – ‘about a third’.

    If your getting half your public sector employees to work you’re not doing bad! 😉

  • Fraggle

    sorry Gerry but knocking the basket-case northern economy is such fun.

    on a practical note, I hope that this lot find a good, all-island solution to mobile phone usage. It makes much more sense having all-island networks (even one would do the trick). it would be much more useful for me to have a telephone which I could use without prohibitive charges on both sides of the border. I’m sure a lot of people have the problem where their phone flips network near the border. I’ve heard of it happening in Portrush too.

    I know the Vodaphone Ireland have an all-Ireland tariff for those based in the south but Vodaphone UK have no such deal, which is a pain in the ass for poor northerners like me who try to earn a crust in the south.

  • IJP

    Fraggle

    But why stop there?

    Much like is the case with the US and Canada (and some Caribbean islands), the UK and Ireland should form a single unit for all telecoms purposes, mobile or otherwise.

  • Henry94

    IJP

    What not campaign for what we are in a position to influence. It’s not the governments who will do this but the mobile companies. They have a vested interest in high roaming charges so they will need to be brought into line by consumer pressure.

    When we have an all-Ireland system we will be in a much better position to negotiate for a (completely sensible)system to cover these islands. The fact that the north as part of the UK would already have an integrated network with the south would get rid of some of the obvious objections from the phone companies side.