Ireland’s financial services industry has already begun to respond to market conditions, as shown in the Financejobs.ie salary figures published on page 4. They show that in most of the major financial services occupations listed in the site, (among 4,000 currently listed jobs), offered salaries are down.
This is encouraging news for both the industry and the economy, as it shows that in a key sector determining the international competitiveness (and viability) of the Irish economy that the needed adjustments are being rapidly made. Salary levels had become uncompetitive in many areas, and, worse still, the overheated labour market was contributing to instability in businesses that were struggling to deal with challenges such as the need for upskilling, and combatting excessive staff turnover levels.
Would that the sanity prevailing in the financial services jobs market was mirrored elsewhere in the economy, where there are more than enough reminders of the ancient Greeks’ fear ‘whom the Gods would destroy they first make mad’. Some examples over the summer, in the face of a credit crisis: 1. Demands for a 10 per cent public sector pay rise; 2. The ‘no’ vote (what now?); 3. Continued indulgence of the likes of the ‘Shell to Sea’ campaign in the light of a doubling in energy prices.
If sanity began to emerge in these and other areas, there might just about begin to be some hope of an end to the worst economic dip since the 1980s. The turnaround in the dollar’s fortunes gives further hope.
Nevertheless, it still is too early to count on an early recovery, and the greatest source of difficulty remains the credit and banking markets.
At the Finance Dublin conference on global financial centres (see report on page 9), delegates were told that credit writeoffs have been of the order of $1 trillion, 80 p.c. of which has been in the US. That leaves about $200 billion in Europe (including Ireland). These have to be made up for, mostly through new bank equity and debt raisings. As of now, only about half of this has been achieved. The first half of the process was relatively easy, (coming off higher historic share prices), and, like a marathon run too fast on the way out, will probably prove harder going on the way back home. |
