Multinationals: An Irish Perspective Business in Ireland 2018

Multinationals: An Irish Perspective

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Multinationals play an important role in the economy 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.

Please Note: There is a discontinuity in the data series for Foreign-owned Multi-nationals in Ireland for 2018. This is due to a change in CSO procedures and not a year-on-year change. See information note on the 'Foreign-owned Multinationals in Ireland' section below.

Key statistics

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Figure 7.1 Employment in Irish affiliates abroad, 2018

Europe, Asia and America each accounted for approximately a third of the total persons engaged in Irish multinationals abroad by continent
Persons engaged in the remaining regions amounted to 2.5%

Figure 7.2 Irish MNEs abroad and foreign MNEs in Ireland, 2018

‌In 2018, Irish multinationals had 998,101 persons engaged in Foreign affiliates and generated Turnover of €232.6 billion
Foreign multinationals had 403,536 persons engaged in affiliates in Ireland and generated €478.8 billion in Turnover

Irish-owned Multinationals abroad

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In 2018, Irish multinationals abroad had Turnover of €232.6bn
The US and UK affiliates accounted for 57.2% of all Turnover

For long labels below use to display on multiple lines	Turnover
Netherlands	3.1
United Kingdom	19.2
United States	38.1
Germany	4.4
France	4.1
Other countries	31.2

There were 998,101 persons engaged in Irish multinationals abroad in 2018
More than one third (33.8%) of all persons engaged in Irish multinationals abroad were based in the US and the UK

For long labels below use to display on multiple lines	Persons engaged
Netherlands	2
United Kingdom	11.8
United States	22
Germany	3
France	2.7
Other countries	58.6

	Persons engaged
United States	219113
United Kingdom	118094
China	38488
Germany	29972
France	26566
Brazil	23851
Spain	21560
Italy	20484
Netherlands	19696
Japan	16215
Canada	16178
Poland	13416

Along with the US and UK, there were significant numbers of persons engaged in Irish owned Foreign affiliates across the globe, with 38,488 persons engaged in China and almost 30,000 in Germany

X-axis label	Turnover
United States	88.6
United Kingdom	44.6
Germany	10.2
France	9.5
Netherlands	7.2
Canada	5.6
Japan	5.5
Spain	4.5
China	4.2
Brazil	4.1
Italy	4.1
Poland	2.5

In 2018, Irish owned enterprises in the US and the UK generated Turnover of €88.6 billion and €44.6 billion respectively
Irish owned enterprises in Germany generated Turnover of €10.2 billion while Irish owned enterprises in France generated Turnover of €9.5 billion

Services was the dominant sector for employment in Irish affiliates abroad in 2018 accounting for 60.3% of total persons engaged
Manufacturing affiliates accounted for 22.1% of persons engaged compared with 16.9% for Distribution
Other Industrial and Construction sectors both employed 0.3%

For long labels below use to display on multiple lines	Persons engaged
Manufacturing	22.1
Other Industrial	0.3
Construction	0.3
Distribution	16.9
Services	60.3

Most Turnover for Irish affiliates abroad came from the Services and Distribution sectors with 41.4% and 31.7% respectively
The Manufacturing sector accounted for 25.6% of Turnover in all Irish-owned foreign affiliates
The rest of the sectoral activities combined were responsible for just over 1% of total Turnover

For long labels below use to display on multiple lines	Turnover
Manufacturing	25.6
Other Industrial	0.6
Construction	0.7
Distribution	31.7
Services	41.4

7.1 Turnover and number of persons engaged in Irish-owned foreign affiliates, 2018

7.2 Turnover and number of persons engaged in Irish-owned foreign affiliates by sector, 2018

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).

Please Note: There is a discontinuity in the data series for Foreign-owned Multi-nationals in Ireland for 2018. This is due to a change in CSO procedures and not a year-on-year change.

Information Note:

Table 7.3 contains the latest data available to CSO on Structural Business Statistics by sector and nationality of ownership in 2018 and updated figures provided in the Structural Business Statistics 2018 publication in September 2020.

Structural Business Statistics 2018

The number of Foreign-owned affiliates rose substantially in 2018, as noted in Figure 7.10. This in turn has led to sizeable increases in the Number of persons engaged, Turnover, and GVA in the year associated with those Foreign-owned affiliates.

The higher numbers of Foreign-owned affiliates identified in the 2018 numbers have arisen as a result of administrative and statistical measurement process improvements, including:

- Ongoing inputs under Regulation 177/2008 on statistical business registers, via the Eurogroups Register (EGR), to improve the quality of statistics on enterprises operating in more than one Member State;

- Better use by CSO of national administrative sources to identify linkages between enterprises in Ireland and their parent information abroad. Previously these enterprises with no source information would have been classified as Irish-owned;

- Increased profiling of companies, with a particular emphasis on group structures and ownership. An ongoing cycle of profiling and review of group structures will continue to be implemented.

These improvements in the processes to identify Foreign ownership represent a break in the time series for pre- and post-2018 data on Structural Business Statistics by sector and nationality of ownership (Table 7.3).

	2017	2018
Number of enterprises	1.2	2.2
Persons engaged	21.4	25.7
Turnover	57.9	65.2
GVA	62.2	66.2

In 2018, Foreign-owned enterprises accounted for 66.2% of total Gross Value Added (GVA) in the Irish non-financial Business Economy, compared to 62.2% in 2017. These enterprises accounted for 65.2% of total Turnover in 2018
Despite large contributions to GVA and Turnover, Foreign-owned enterprises accounted for just 2.2% of the total number of enterprises in the Irish Business Economy in 2018
Foreign-owned enterprises accounted for over one quarter (25.7%) of persons engaged in the Irish Business Economy in 2018

	2017	2018
Number of enterprises	3	4.7
Persons engaged	40.6	44.1
Turnover	80.8	84.1
GVA	87.3	88.6

The Industry sector was dominated by Foreign-owned enterprises in 2018, with 84.1% of Turnover and 88.6% of Gross Value Added, the bulk of which came from enterprises that were owned outside the EU
There were 876 Foreign-owned enterprises in the Industrial sector, which represented just 4.7% of all enterprises in the Industrial sector but accounted for 44.1% of persons engaged

	2017	2018
Number of enterprises	1.8	3.1
Persons engaged	24.2	28.3
Turnover	40.2	49
GVA	39.3	45.4

In the Distribution sector, which includes Retail & Wholesale Trade, 1,476 or 3.1% of all enterprises were Foreign-owned
These Foreign-owned enterprises employed 28.3% of all persons engaged in this sector and contributed 45.4% of total Gross Value Added

	2017	2018
Number of enterprises	1.1	2.1
Persons engaged	17.3	22.1
Turnover	54	63.4
GVA	42.3	51.8

Just 2.1% of all Services enterprises in Ireland were Foreign-owned but they employed 22.1% of persons engaged in the sector
These Foreign-owned enterprises in the Services sector accounted for 63.4% of total Turnover and 51.8% of total Gross Value Added (GVA)
EU owned Services enterprises accounted for 56.8% of all Foreign-owned enterprises and 47.7% of persons engaged, while 85.4% of Turnover and 81.4% of GVA came from enterprises owned outside the EU

	Gross Value Added
Ireland	62.8
Hungary	50
Slovakia	48.1
Romania	44.2
Luxembourg	43.7
Czech Republic	42.9
Latvia	33.7
Malta	32.4
Bulgaria	32.2
Poland	30.5
Netherlands	29.7
Croatia	28.9
Lithuania	28.3
United Kingdom	27.5
Austria	27.3
Slovenia	27.2
Sweden	27.2
Germany	27
EU28	26.1
Belgium	24.7
Estonia	24.7
Portugal	23.8
Spain	23.2
Finland	23
Denmark	22.2
France	17.1
Greece	16.5
Italy	15.9
Cyprus	13.2

In 2017, Ireland ranked highest in the EU28 for Gross Value Added (GVA) contributions from Foreign-owned enterprises to the overall non-financial economy with 62.8% of total GVA
This compares to the EU28 average of 26.1% for 2017
Other high-ranking countries included Hungary (50.0%), Slovakia (48.1%) and Romania (44.2%)

7.3 Structural Business Statistics by sector and nationality of ownership, 2018

Table 7.1 Turnover and number of persons engaged in Irish-owned foreign affiliates, 2018
	Turnover	Persons engaged
	€ millions	Number
United States	88,557	219,113
United Kingdom	44,578	118,094
Other countries	99,424	660,894
All countries	232,559	998,101

Table 7.2 Turnover and number of persons engaged in Irish-owned foreign affiliates by sector, 2018
	Turnover	Persons engaged
	€ millions	Number
Manufacturing	59,472	221,037
Other industrial	1,354	3,382
Construction	1,675	3,309
Distribution	73,694	168,481
Services	96,364	601,892
All sectors	232,559	998,101

Table 7.3 Structural Business Statistics by sector and nationality of ownership, 2018
	Irish-owned	Foreign-owned affiliates			All enterprises
		Owned by EU multinationals	Owned by non-EU multinationals	Total
Number of enterprises
Industry¹	17,821	487	389	876	18,697
Construction	57,112	369	137	506	57,618
Distribution	46,209	911	565	1,476	47,685
Services (excl. Financials)	153,942	1,864	1,415	3,279	157,221
All sectors	275,084	3,587	2,488	6,137	281,221
Number of persons engaged
Industry¹	140,059	31,841	78,489	110,330	250,389
Construction	135,233	5,633	3,655	9,288	144,521
Distribution	268,525	66,327	39,885	106,212	374,737
Services (excl. Financials)	625,172	84,687	93,019	177,706	802,878
All sectors	1,168,989	186,152	214,434	403,536	1,572,525
Turnover (€millions)
Industry¹	42,548	14,229	211,437	225,667	268,215
Construction	26,536	1,460	1,123	2,583	29,119
Distribution	92,975	34,454	54,869	89,323	182,298
Services (excl. Financials)	93,190	23,508	137,752	161,261	254,451
All sectors	255,249	72,982	404,332	478,833	734,082
GVA (€millions)
Industry¹	12,218	4,247	90,722	94,969	107,187
Construction	9,631	473	563	1,036	10,667
Distribution	12,805	4,659	5,986	10,645	23,450
Services (excl. Financials)	43,721	8,740	38,243	46,983	90,704
All sectors	78,375	17,987	135,446	153,633	232,008
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 includes NACE divisions R92, R93, S95, S96.
Please Note: There is a discontinuity in the data series for Foreign-owned Multi-nationals in Ireland for 2018. This is due to a change in CSO procedures and not a year-on-year change.

Business in Ireland 2018