Austrian news broadcaster ORF have published an article in which they explain the concern that currently exists in the Republic of Ireland over potential job losses in the country’s powerful tech industry.
For many years the fact that Ireland had become a European home for many Silicon Valley giants, such as Google, Microsoft, Apple, Facebook and Twitter, had been a point of contention with other EU nations. Ireland had achieved this largely down to its very low corporation tax rate of 12.5%, as well as the fact that there is no language barrier between Ireland and the United States. As a result, nearly all of the major Silicon Valley companies have their European headquarters in Dublin.
This has generated a situation in which around 12% of all people employed in Dublin work in the IT sector. The wealth of these organisations has greatly benefitted the Irish economy, with around half of all corporate taxes being paid by tech companies and multinationals, and with 14 billion euros collected in the first three quarters of 2022.
Therefore, despite the low taxes, this income has helped Ireland to cushion the consequences of pandemic-related restrictions and inflation on the economy. However, after a boom in tech-related jobs during the pandemic, major tech companies such as Twitter and Meta have recently been cutting staff, creating concerns about the situation in Ireland.
In response, the Irish Deputy Prime Minister Leo Varadkar said that layoffs “should not be taken as a major crisis”, and whilst recognising the importance of the tech industry to the wider economy, he states he believes the economy is sufficiently diversified. Experts say that whilst layoffs are of course not good for those involved, a slow down in the growth of the tech industry could actually help the economy to develop in other sectors and also reduce the rapid rise in prices in the property market in Dublin.
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