Multinationals: An Irish Perspective Business In Ireland 2015

Multinationals: An Irish Perspective

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Multinationals play an important role in the economies of many countries. Increasingly, multinationals create a physical presence in several countries around the world in order to maximise their global earnings.

This chapter presents statistics on the activities of the affiliates of Irish multinationals abroad and the contribution made by the affiliates of Foreign multinationals in Ireland. See Tables 7.1, 7.2 and 7.3 at the end of this section for more detail on the data in the graphs.

Key statistics

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Figure 7.1 Employment in Irish affiliates abroad, 2015

In terms of employment in Irish multinationals abroad by continent, Europe, Asia and America each had just under a third of the total
Employment in the remaining regions amounted to a little over 2%

Figure 7.2 Irish MNEs abroad and foreign MNEs in Ireland, 2015

‌In 2015, Irish multinationals employed almost 774,000 persons in Foreign affiliates and generated Turnover of €168.3 billion
By contrast, Foreign multinationals employed just under 304,400 persons in affiliates in Ireland and generated Turnover of €339.2 billion

Irish-owned Multinationals abroad

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In 2015, Irish multinationals abroad had turnover in excess of €168bn
The US and UK affiliates accounted for almost 61% of all turnover

For long labels below use to display on multiple lines	Active enterprises
United States	34.6
United Kingdom	26.1
Other countries	39.2

There were nearly 774,000 persons employed in Irish multinationals abroad
35% of all employment in Irish multinationals abroad were based in the US and the UK

For long labels below use to display on multiple lines	Active enterprises
United States	21.7
United Kingdom	13.3
Other countries	65

	2015
China	27326
Germany	22494
Mexico	20838
France	20610
Brazil	18062
Spain	17849
Italy	16455
Netherlands	16142
Canada	12635
Argentina	9633

Aside from the US and UK, there were significant numbers of persons engaged in Irish owned foreign affiliates across the globe, such as China with over 27,000 employees and Mexico with nearly 21,000

	2015
Germany	6.2
Netherlands	5.6
France	4.4
Australia	4
Spain	2.8
Canada	2.7
Italy	2.7
Switzerland	2.6
Belgium	2.1
Sweden	2

Irish owned enterprises in Germany generated turnover in excess of €6.2 billion
A number of other countries such as the Netherlands, France and Austrailia also generated a significant amount of turnover in 2015; each country reported turnover in excess of €4 billion

Services which includes Distribution, was the dominant sector for employment in Irish affiliates abroad in 2015 with 79.1% of total persons engaged
Manufacturing affiliates accounted for 20.2% of employment
Other Industrial and Construction sectors employed 0.6% and 0.1% respectively

For long labels below use to display on multiple lines	Active enterprises
Manufacturing	20.2
Other industrial	0.6
Construction	0.1
Services	79.1

Most Turnover for Irish affiliates abroad came from the Services sector at 74%
The Manufacturing sector accounted for a significant share of total Turnover at 23.2%

For long labels below use to display on multiple lines	Active enterprises
Manufacturing	23.2
Other industrial	2.3
Construction	0.4
Services	74

	Turnover
Other	6.3
Construction	0.6
Information and Communication	6.8
Financial and Insurance activities	5.8
Professional, Scientific and Technical activities	34.2
Manufacturing	23.2
Distribution	23.1

The Professional, Scientific and Technical sector had the largest share of turnover generated by Irish affiliates abroad at 34.2%
The Manufacturing and Distribution sectors accounted for just over 23% of turnover each
The rest of the sectoral activities combined were responsible for less than 20% of total turnover

	Services	Manufacturing
Irish	61	38.1
British	45.3	30.6
French	46.3	39.1
German	57.5	40.7
Italian	30.5	55.1
	0	0
EU28	49.4	39.5

Figures for Irish-owned multinationals outside the EU show that the Services sector generated 61.0% of all turnover compared to 38.1% for Manufacturing
Irish and German owned multinationals each had over the EU average of 49.4% of their turnover from Services
Italy generated significantly more turnover from Manufacturing than the EU average

Table 7.1 Turnover and number of persons engaged in Irish-owned foreign affiliates, 2015

Table 7.2 Turnover and number of persons engaged in Irish-owned foreign affiliates by sector, 2015

Foreign-owned Multinationals in Ireland

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The Financial and Insurance sector is excluded from this section. Accordingly, all the measures below relate to the non-financial business economy only (which encompasses the broad sectors of Industry, Services, Distribution and Construction).

	2014	2015
Number of enterprises	1.5	1.3
Persons engaged	24.3	22.2
Turnover	52.7	56.4
GVA	52.1	63.3

Foreign-owned enterprises in 2015, accounted for 63.3% of total GVA and 56.4% of total Turnover in the Irish non-financial business economy
Despite such large contributions to GVA and Turnover, foreign-owned enterprises accounted for just 1.3% of the total number of enterprises in the Irish business economy
Out of a total of 260,267 enterprises, 3,504 Foreign-owned enterprises accounted for 22.2% of persons engaged in the Irish business economy
In 2015, the contribution of Foreign-owned enterprises to the Irish business economy had risen from 52.1% in 2014 to 63.3% of GVA

	2014	2015
Number of enterprises	3.6	3.9
Persons engaged	39.2	41.7
Turnover	72.9	86
GVA	72.6	89.2

The Industry sector in particular was dominated by foreign-owned enterprises in 2015, with 86.0% of Turnover and 89.2% of GVA, the bulk of which came from enterprises that were owned outside the EU
There were 672 foreign owned enterprises in the Industrial sector, which represented just 3.9% of all enterprises but accounted for 41.7% persons engaged

	2014	2015
Number of enterprises	2.2	1.8
Persons engaged	25.6	24.5
Turnover	38.6	32.8
GVA	40.7	36.4

In the Distribution sector, which includes Retail & Wholesale Trade, 842 or 1.8% of all enterprises were foreign-owned
These foreign-owned enterprises employed nearly one quarter, 24.5%, of all persons engaged in this sector and contributed over 36% of total GVA

	2014	2015
Number of enterprises	1.5	1.3
Persons engaged	21.6	18.1
Turnover	52.3	43.2
GVA	44.8	38.9

Just 1.3% of all Services enterprises in Ireland were foreign owned, and they employed 18.1% of persons engaged in the sector
These enterprises accounted for 43.2% of total Turnover and 38.9% of total GVA
EU owned services enterprises accounted for over half of all foreign owned enterprises and their employees, while over three quarters of the Turnover and GVA came from enterprises owned outside the EU

	Gross Value Added
Hungary	52.7
Ireland	52.1
Luxembourg	47
Romania	43.9
Slovakia	43.4
Czech Republic	42.3
Bulgaria	33
Latvia	31.1
United Kingdom	29.9
Poland	29.1
Belgium	27.5
Sweden	27.4
Netherlands	27.3
Lithuania	26.5
Estonia	26.4
Austria	26.3
Croatia	24.9
EU28	24.1
Slovenia	24.1
Malta	22.6
Portugal	22.3
Germany	21.8
Finland	21.6
Denmark	21.3
Spain	21.1
France	16
Italy	14.7
Greece	12
Cyprus	11.2

Ireland ranked second in the EU28 for Gross Value Added contributions from Foreign-owned enterprises to the overall non-financial economy in 2014, at 52.1% of total GVA. Hungary had the highest rate at 52.7%
This is in comparison to the EU28 average of 24.1% for 2014
Other high ranking countries included Luxembourg at 47%, Romania with 43.9% and Slovakia with 43.4% respectively

7.3 Structural business statistics by sector and nationality of ownership, 2015

Table 7.1 Turnover and number of persons engaged in Irish-owned foreign affiliates, 2015
	Turnover	Persons engaged
	€ millions	Number
United States	58,251	167,801
United Kingdom	43,993	102,960
Other countries	66,034	503,091
All countries	168,278	773,852

Table 7.2 Turnover and number of persons engaged in Irish-owned foreign affiliates, 2015
	Turnover	Persons engaged
	€ millions	Number
Manufacturing	39,092	156,457
Other industrial	3,915	4,515
Construction	745	1,044
Services	124,526	611,836
All sectors	168,278	773,852

Table 7.3 Structural business statistics by sector and nationality of ownership, 2015
	Irish-owned	Foreign-owned affiliates			All enterprises
		Owned by EU multinationals	Owned by non-EU multinationals	Total
Number of enterprises
Industry¹	16,504	423	249	672	17,176
Construction	50,427	105	14	119	50,546
Distribution	45,784	571	271	842	46,626
Services (excl. Financials)	144,048	1,057	814	1,871	145,919
All sectors	256,763	2,156	1,348	3,504	260,267
Number of persons engaged
Industry¹	129,197	36,064	56,536	92,600	221,797
Construction	106,469	2,074	177	2,251	108,720
Distribution	261,274	53,598	31,039	84,637	345,911
Services (excl. Financials)	566,884	70,862	54,026	124,888	691,772
All sectors	1,063,824	162,598	141,778	304,376	1,368,200
Turnover (€millions)
Industry¹	32,746	25,196	175,863	201,059	233,805
Construction	13,823	*	*	1,535	15,358
Distribution	99,557	22,203	26,375	48,578	148,135
Services (excl. Financials)	115,802	17,627	70,400	88,027	203,829
All sectors	261,928	*	*	339,199	601,127
GVA (€millions)
Industry¹	10,034	8,844	74,238	83,082	93,116
Construction	6,077	*	*	99	6,176
Distribution	12,219	3,248	3,747	6,995	19,214
Services (excl. Financials)	37,791	5,698	18,405	24,103	61,894
All sectors	66,121	*	*	114,279	180,400
Source: CSO Structural Business surveys and Business Demography data.
¹Industry covers NACE Rev.2 (05-39) of which Manufacturing (10-33), Construction (41-43), Distribution (45-47) and Services covers NACE Rev. 2 H to N (excluding K) and R92, R93, S95, S96.
* Indicates confidential data

Business In Ireland 2015