# Dell job cuts..wider implications



## Firefly

Heard this morning that Dell are cutting 450 jobs in Ireland. I think this will have a major knockon effect to the wider economy. Won't be long before the other multi-nationals take notice and review the cost of doing business in ireland....hold on tight folks & keep the SSIA money for emigration!


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## aircobra19

*Re: Dell job cuts..wider imnplications*

What type of jobs?


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## elefantfresh

*Re: Dell job cuts..wider imnplications*

They said "all areas" and "all geographies"


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## pinkyBear

*Re: Dell job cuts..wider imnplications*

Hi there,
It was on the radio this am, that Ireland may not be hit so hard, the Irish profits are good - demand is high in Europe.. So Ireland may not be hit with the full whack of 10% reduncdancies..


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## shanegl

*Re: Dell job cuts..wider imnplications*

Its a global cut, all divisions, all geographical locations of 10%. So to be fair its not related to Ireland's competiveness.


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## pinkyBear

*Re: Dell job cuts..wider imnplications*

This am on News Talk they had a  business spokesperson speaking, and his view -(I know it is only a view) was that north america could be hit the most due to labour costs and a decrease in profits, however with the European Marke being so strong for Dell that it was likely that Ireland would not be hit with the full 10%...


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## aircobra19

*Re: Dell job cuts..wider imnplications*

Especially considering 
http://www.askaboutmoney.com/showthread.php?t=56033(*IT staff shortage leaves 17,400 jobs to be filled)*

I assume most of the Dell cuts will be on the production line and support.


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## Purple

*Re: Dell job cuts..wider imnplications*



Firefly said:


> Heard this morning that Dell are cutting 450 jobs in Ireland. I think this will have a major knockon effect to the wider economy. Won't be long before the other multi-nationals take notice and review the cost of doing business in ireland....hold on tight folks & keep the SSIA money for emigration!


 Rubbish, we are the Celtic Tiger! Everything is great here. So what if we have some of the highest wage rates in Europe? So what if we have crap infrastructure? So what if we now have to compete with East European economies that are much cheaper and have the same progressive tax rates? So what if public sector wage increases are driving up costs throughout the economy? So what if we have some of the most expensive utilities in the EU? So what if our inflation is about the highest in the EU? None of that matters, it'll all be grand. We just have to keep out head's in the sand and ignore the fools who think that basic economic principles apply to the Irish economy. Remember; they are the same people who said that property price increases were not sustainable! I bet they feel stupid now!


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## Raskolnikov

*Re: Dell job cuts..wider imnplications*



Purple said:


> Rubbish, we are the Celtic Tiger! Everything is great here. So what if we have some of the highest wage rates in Europe? So what if we have crap infrastructure? So what if we now have to compete with East European economies that are much cheaper and have the same progressive tax rates? So what if public sector wage increases are driving up costs throughout the economy? So what if we have some of the most expensive utilities in the EU? So what if our inflation is about the highest in the EU? None of that matters, it'll all be grand. We just have to keep out head's in the sand and ignore the fools who think that basic economic principles apply to the Irish economy. Remember; they are the same people who said that property price increases were not sustainable! I bet they feel stupid now!


Bravo


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## therave

*Re: Dell job cuts..wider imnplications*

i believe that most of the jobs in Ireland will be tansferring to Poland over the  next few years and the current crop of Polish people currently working for Dell in Ireland are being trained to operate the new factory in Poland..
wider implications will be every thing from the local shops to the suppliers


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## Purple

*Re: Dell job cuts..wider imnplications*

I think it's more than likely that Dell in Limerick and Seagate in Derry will both be gone in 5 years.
Both have opened sister plants in lower cost economies that do the same thing.
The same can be said for major employers in Wicklow, Cork and Galway. Most of the large IDA industrial estates around Dublin are empty or those multinationals that are left have skeleton staffs that just about keep the plant open. Drive into any of the estates around Blanchardstown and you will see huge plants with parking for a few hundred cars but a few dozen cars parked outside. Citywest only has one or two companies that actually manufacture anymore. Athlone, Galway, Waterford, Cork, Limerick, Shannon; it's all the same. We had our chance to build a world-class economy and we blew it, we blew it big style, and we only have ourselves to blame.


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## shanegl

*Re: Dell job cuts..wider imnplications*

Tsk, didn't you get the memo Purple, we're a _Knowlege Economy™_ now. We don't need to get our hands dirty in factories anymore, none of this nasty manufacturing work for us!


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## elefantfresh

*Re: Dell job cuts..wider imnplications*

And what did we do? We put them all back in charge again....


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## aircobra19

*Re: Dell job cuts..wider imnplications*



elefantfresh said:


> And what did we do? We put them all back in charge again....



Doh!


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## Purple

*Re: Dell job cuts..wider imnplications*



elefantfresh said:


> And what did we do? We put them all back in charge again....



Yea, 'cause Pat Rabbitte was going to take on the public sector unions, the hospital consultants, the legal industry etc and make up competitive again ... watch out for them there flying pigs.


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## aircobra19

*Re: Dell job cuts..wider imnplications*

So who let them get uncompetitive? How long have they had to sort it out?


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## Purple

*Re: Dell job cuts..wider imnplications*



aircobra19 said:


> So who let them get uncompetitive? How long have they had to sort it out?



My take on it is that once our government relinquished its constitutional duty to run the country to un-elected interest groups we were on a downhill path. I am of course talking about social partnership, particularly over the last two agreements. Once SIPTU and its ilk took over it was inevitable that the sectors of the economy that had to compete in an internationally open market would suffer, since there is low union membership in the efficient sectors of the economy, the ones that generate real income for the country.


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## z108

*Re: Dell job cuts..wider imnplications*

If those in charge are the ones to blame then in this case whos more to blame ? Charlie McCreevy or  Cowen/Bertie ?


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## Purple

*Re: Dell job cuts..wider imnplications*

I blame Bertie all the way. He's the one who won't make the hard (unpopular) decisions. Charlie McCreevy would and did and that's why he was shipped off to Europe. He's not in charge now, more's the pity.
Cowan would be better than Bertie, Pat and Enda would be worse.


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## Raskolnikov

*Re: Dell job cuts..wider imnplications*



Purple said:


> I blame Bertie all the way. He's the one who won't make the hard (unpopular) decisions. Charlie McCreevy would and did and that's why he was shipped off to Europe. He's not in charge now, more's the pity.
> Cowan would be better than Bertie, Pat and Enda would be worse.


Agreed.

The economic shock caused by September 11th was the time that we should have started to evaluate competitiveness in the country. Instead, we went on an unrestrained borrowing splurge snapping up houses, cars and Prada handbags like there was no tomorrow. Biffo and Bertie sat with their hands in their pockets and didn't do a thing to reign in the overheating economy.

Every interest rate hike we get is a nail in the coffin of the property market and consumer confidence. Believe me, it won't take too many more nails in the coffin before we're buried.


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## ClubMan

*Re: Dell job cuts..wider imnplications*



Firefly said:


> Dell job cuts..wider imnplications
> 
> have a major knockon effect


I'd consider the state of our education system to be a more important factor in this than some transient job losses. To think that we're considered an _English _speaking country and all?


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## PM1234

*Re: Dell job cuts..wider imnplications*

10% worldwide and 450 jobs to go in Ireland. 

Job cuts for all the companies with Dell as their main client. Dell already has a plant in Poland and yes while other companies move with them and some of them are already doing this, think of the further implications for the smaller comanies (employees) relying on Dell. Limerick is currently undergoing a big transformation. The impact will be hard. 

As for the knowledge economy - Dell is considered an example of one such company. Suppose the gov. will just concentrate more on R&D! 

A saddening part is that Dell employees found out along with everyone else by hearing it on the radio.


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## Purple

*Re: Dell job cuts..wider imnplications*



PM1234 said:


> As for the knowledge economy - Dell is considered an example of one such company. Suppose the gov. will just concentrate more on R&D!


The Dell plant in Limerick is an assembly and logistics centre. They may as well be assembling custom order dinky cars. There were far more jobs supplying Dell 10 years ago.
The government’s investment in R&D is centred on 3rd level bodies and multinationals that manufacture in Ireland. For all the money spent it has had no real impact economically. A small number of Irish companies, mainly in the food and IT sector have enjoyed real benefit. We are a long way from developing a Nokia or a Philips. As things currently stand I would bet the farm that it will never happen.


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## room305

*Re: Dell job cuts..wider imnplications*



PM1234 said:


> Suppose the gov. will just concentrate more on R&D!



As someone who works in this area I can tell these jobs are not going to be the saviour of the Irish economy. The bulk of what is classified as "research" here is really just software testing. Work that can easily be done by graduates with no requirement for fourth level education. Indeed, I am aware of quite a few PhD. holders who consider their qualifications an actual hinderance when it comes to looking for a job here.

Even if the government does continue to pour money into the sector, the actual amount of job creation is low. I know of one research team in a university that received €25 million worth of grants but it lead to the creation of only ten new jobs. 

Now how many jobs would €25 million worth of house building create?


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## Purple

The government has not found a way to use R&D funding to grow Irish manufacturing companies. The only exceptions are in the food industry. In hi-tech engineering (the sector that the USA, Japan and Germany grew their economies on) they have failed utterly. If the company is Dublin based, or anywhere east of the Shannon, then the levels of grant aid are so small that they are not worth the paperwork. Even in the BMW area the impact has been limited to say the least. R&D funding in this country is, in reality, a mechanism to use for additional 3rd level grants.


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## joe sod

Purple said:


> The government has not found a way to use R&D funding to grow Irish manufacturing companies. The only exceptions are in the food industry. In hi-tech engineering (the sector that the USA, Japan and Germany grew their economies on) they have failed utterly. If the company is Dublin based, or anywhere east of the Shannon, then the levels of grant aid are so small that they are not worth the paperwork. Even in the BMW area the impact has been limited to say the least. R&D funding in this country is, in reality, a mechanism to use for additional 3rd level grants.


 
I agree fully with this. Also in ireland the public service and government does not really employ many high tech/ engineering graduates. This is in contrast to countries like britain germany and USA which directly employ these graduates in areas like defence and state companies, this provides a pool of highly skilled expertise which have spawned new industries in these countries. In ireland you either stay in the poorly paid university sector or you emigrate. In many ways it is the same reason we have terrible planning and infrastructure it is our inability to plan ahead.


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## Purple

joe sod said:


> I agree fully with this. Also in ireland the public service and government does not really employ many high tech/ engineering graduates. This is in contrast to countries like britain germany and USA which directly employ these graduates in areas like defence and state companies, this provides a pool of highly skilled expertise which have spawned new industries in these countries. In ireland you either stay in the poorly paid university sector or you emigrate. In many ways it is the same reason we have terrible planning and infrastructure it is our inability to plan ahead.


 That's an excellent point. I hadn't thought of it before.


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## Howitzer

If Dell is cutting 10% of it's world wide workforce but at the same time is opening a new plant in Poland surely that means a bigger proportion of the existing workforce must be let go in order to maintain a 10% reduction in overall headcount. As such, on a purely numbers basis, more than 450 jobs are at risk. 

In reality all the jobs could be lost but only a 10% reduction in the combined Ireland/Poland (European production) operations would be achieved, which is the stated desire of the cuts.

Kinda like a "cost neutral" cut in working numbers if you like.


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## Trustmeh

This thread is descending into useless speculation - do you people believe everything the media feeds you?  Mods please close thread it is providing NOTHING worthwhile.

Dell is building a plant in Poland.  They have also built more than one factory in USA.  They will more than likely build more than one in South America too. Hey, watch out for India as well...and cross your fingers for China someday...this does not mean they will go closing all the first built factories necessarily...at least not in the immediate future.

All the Irish based polish workers are NOT lining up to return to LODZ to build Dell PCs - I hate to dissapoint you - they actually like it over here.  The cut in wages they would take to return to Poland would also prevent them doing same.

10% of GLOBAL workforce over the next 12 months - how on earth media is able to translate this to 450 in Limerick right now.  Please, relax and read the funnies or the sports section - the media just loves stirring up things like jobs markets and housing.


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## johnwilliams

howitzer i would say your asessment of the 10% workforce reduction to be spot on
why would they need irish based polish workers, is there not enough polish based workers in poland


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## Trustmeh

Sure - Sure - now you are saying that 450 jobs in Ireland wont go - you recon its more likely that all 4500 jobs will be gone.  Yeah - that makes sense.


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## johnwilliams

i cannot see them touching the jobs in the us after the bad publicity they received about the outsourcing to india fiasco plus they opened a new plant in the us recently (can't remember the state in question) that they received a major grant from that state .that state governor would not be very happy with that


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## Howitzer

Just to follow up on an old thread. Dell to cut 250 jobs from it's Cherrywood operations. These are mainly admin/support roles in one form or another. The production facilities are untouched but the spokeswoman refused to be drawn on further Irish jobs cuts.

I would see this as a stepping stone rather than an end in itself, but then again I'm a bit of an oul pesimist.

[broken link removed]


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## joe sod

Howitzer said:


> Just to follow up on an old thread. Dell to cut 250 jobs from it's Cherrywood operations. These are mainly admin/support roles in one form or another. The production facilities are untouched but the spokeswoman refused to be drawn on further Irish jobs cuts.
> 
> I would see this as a stepping stone rather than an end in itself, but then again I'm a bit of an oul pesimist.
> 
> [broken link removed]


 
well that goes against the grain a bit, the mantra was that it was always manufacturing that bears the brunt of competition, maybe it shows that the pressures on manufacturing might be easing and other areas which up to this were not as exposed to competitive pressures may now feel some of the pain


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## Sangster

I work in Cherrywood and to say that it could have been handled better would be an understatement.  The news is on the RTE.ie website from about 12:30 today and it gets announced on the floor at one.  To a small minority it wasn't a surprise but to the majority who were made redundant it was.  I would like to say that this will be the end of it but I sincerely doubt it.

The consumer/home user sales teams were moved India a few years ago, the transactional business sales teams were moved 6 months ago, the prefered accounts sales teams will be moved to Glasgow before the year end.  If there are people on here that think the Lodz plant won't affect Limerick - dream on.


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## Brianne

True story re Dell in Limk............Fellow on dole in Limk about eight years ago who was told by Labour Exchange to report for interview to Dell or face getting dole cut. 
Dell was not his preferred employment option , to say the least, but what to do?
Dresses up , does a  good interview and finally when asked about his own interests, he proceeded to tell them ,totally truthfully as it happened, about his very intense interest in the trade union movement and his activities in his previous workplace as employees' representative.He discussed the importance of employee representation for productivity reasons etc.

Result :  Positive, No job with Dell!!!


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## annR

I definitely find it pretty worrying that these are business sales jobs which are being moved.  This is not manufacturing, nor is it admin and support.  I work in sales in a major multinational and up till now have felt reasonable safe in hoping that customer facing sales jobs would hardly be moved elsewhere.  Sangster - is this the case, did they move field sales jobs to Scotland?


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## aircobra19

Any job can be moved or outsourced if the bean counters say its worthwhile.


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## bamboozle

*Re: Dell job cuts..wider imnplications*



Purple said:


> I blame Bertie all the way. He's the one who won't make the hard (unpopular) decisions. Charlie McCreevy would and did and that's why he was shipped off to Europe. He's not in charge now, more's the pity.
> Cowan would be better than Bertie, Pat and Enda would be worse.


 

Fully agree, one of Bertie’s 1st moves when in power was to cave in to the demands of the trade unions, allow them negotiate a few very favorable collective agreements during the early boom years (when lots of other folk were at the time distracted trying to buy, build, rent out & flog property) meant that he had the support of the unions but he failed to realise that the economic growth was not sustainable and he had set a dangerous precedent of unions expecting their future demands to be met.
At the same time a complete failure to budget and control the costs of numerous capital projects (luas, port tunnel etc etc) by the government (did any heads ever roll in the various government departments or councils when these shocking overcosts were exposed?) 

Quite comical when you consider the leader of your country claims to be an accountant!!


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## Guest117

I know this is not supposed to be a Bertie bashing thread but what the heck !  Others are having a go!

My view on " our greatest politician ever "

He has precided over successive governments that have sold our coutry down the swannee. What have we got to show for the Celtic Tiger years

Hundreds of thousands of crap quality houses with insulation standards that the rest of western europe are laughing at.

No infrastructure
No schools
No health system
Rising crime
No public transport
We are paying fines to europe for not meeting kyoto targets
We are granting licences to build the wrong type of gas power stations

The list goes on and on

I don't know if the other guys would have done better - but could they do worse ??!!

Please all you Bertie fans out there - spare us the speeches on how much has been spent in different areas etc - we can get that from Mary Harney, Brian Lenihan, Michael Martin and co any day of the week.

Lets poll Dell workers to see how many fans Bertie has lost this week

Apologies to all for the rant


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## Purple

annR said:


> I definitely find it pretty worrying that these are business sales jobs which are being moved.  This is not manufacturing, nor is it admin and support.  I work in sales in a major multinational and up till now have felt reasonable safe in hoping that customer facing sales jobs would hardly be moved elsewhere.  Sangster - is this the case, did they move field sales jobs to Scotland?



There are additional costs shipping goods from a manufacturing base in India or China to the EU. There are no logistical costs having the guy answering the phone over there. The Dell plant in Poland occupies about half the site. I will be very surprised if the operations of the Limerick plant are not duplicated there within the next three years. 
It is not too late to stop the rot; we had our chance and we blew it. Irish companies will only survive if they can develop export markets and prove themselves competitive on an international stage by offering goods and/or services with a value-add that is good value for money. So they will need to offer a high value add or a low cost.

The days of living off the Multinationals who came here chasing higher margins are over. We now have to offer them more than the chance to hire cheap and funnel revenue through our country and if we are going to do that we have to drastically improve our education system, our infrastructure and the supplier base that we can offer to them.


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## gradgrind

I'd not hold out much hope for improving education. There's a serious problem now getting students to go into the "hard" degrees. Technology courses are finding it difficult to fill their courses and even when they do the candidates aren't on average up to the standard of previous years. 

What's happened now is that leaving cert students (or the mothers) know that many science and engineering courses are difficult, the resulting work is demanding and the pay is only ok - particularly on a per hour basis.

In the 90's US companies came here and expanded R&D because for a period some of the best Irish graduates were available from tech areas. A strong dollar and tech bubble allowed salaries in these fields to rapidly increase. Largely the salaries were connected to Californian rates.

Unfortunately other sectors decided they couldn't have this and pushed up their salaries without any economic reasons to support their rises. So now we've some of the highest paid teachers, police, politicians etc. in the entire world.

Now tech salaries have been effectively flat for around 5 years, so we've an unhealthy situation where talent that could be adding to the wealth of the country are instead targeting public sector jobs. 

An over attractive public sector is a sign of a diseased economy. It'd be like everyone in Google wanting to work in the HR dept..


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## lightswitch

In a small effort to do someting about the situation rather than complain about it I think we should all make an effort to purchase products made in Ireland or at least in Europe.   The most unlikely products are now being imported from China.  It is not just small items coming from China but 3 piece suites and other heavy household items. (serious carbon footprint). Take a look at what your buying even in the household deps of M&S, its China, China, China.  It will cost more yes, but if even a % extra stays in our economy we "should" benefit somewhat.


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## annR

> There are additional costs shipping goods from a manufacturing base in India or China to the EU. There are no logistical costs having the guy answering the phone over there.


 
No logistical costs but there are other considerations such as, will you find enough European language speakers over there to take over the entire European telesales organisation (which often for multinationals is based in Ireland now).  Will you even find all those people in Eastern Europe?  There is a presumption that jobs which involve close or face to face communication to a local marketplace will have to stay in the local market (Ireland or Europe on bigger scale).  If this changed it would a lot of sales people plenty to think about.


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## mickman

purchase products made in ireland?? you must b joking, we live in a competitive economy where people want the cheapest prices. if dell are not competitive let them leave, why dont they re-invent themsleves like apple . manufacturing is dead in ireland , its only a matter of time before they move all their manufacturing elsewhere.its the obvious thing to do


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## lightswitch

It may be the obvious thing to do for short term gain but as an Island nation is crazy to allow ourselves to depend totally on imported products. Personally I think it is naive in the extreme not ot look at the long term implications of the actions we take today.  Cheaper isn't always better for very many reasons.


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## Purple

mickman said:


> purchase products made in ireland?? you must b joking, we live in a competitive economy where people want the cheapest prices. if dell are not competitive let them leave, why dont they re-invent themsleves like apple . manufacturing is dead in ireland , its only a matter of time before they move all their manufacturing elsewhere.its the obvious thing to do


Many manufacturing processes are not labour intensive and so can survive in high wage economies. Those that are low value-add are gone already. Our biggest problem is that increasingly we lack a competitive within a European context.


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## Purple

mickman said:


> manufacturing is dead in ireland , its only a matter of time before they move all their manufacturing elsewhere.its the obvious thing to do


 Who are "they"?


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## mickman

dell


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## joe sod

gradgrind said:


> I'd not hold out much hope for improving education. There's a serious problem now getting students to go into the "hard" degrees. Technology courses are finding it difficult to fill their courses and even when they do the candidates aren't on average up to the standard of previous years.
> 
> What's happened now is that leaving cert students (or the mothers) know that many science and engineering courses are difficult, the resulting work is demanding and the pay is only ok - particularly on a per hour basis.
> 
> In the 90's US companies came here and expanded R&D because for a period some of the best Irish graduates were available from tech areas. A strong dollar and tech bubble allowed salaries in these fields to rapidly increase. Largely the salaries were connected to Californian rates.
> 
> Unfortunately other sectors decided they couldn't have this and pushed up their salaries without any economic reasons to support their rises. So now we've some of the highest paid teachers, police, politicians etc. in the entire world.
> 
> Now tech salaries have been effectively flat for around 5 years, so we've an unhealthy situation where talent that could be adding to the wealth of the country are instead targeting public sector jobs.
> 
> An over attractive public sector is a sign of a diseased economy. It'd be like everyone in Google wanting to work in the HR dept..


 
excellent point, again the finger points back at the public service


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## aircobra19

joe sod said:


> excellent point, again the finger points back at the public service



How are the two linked?


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## Sangster

annR said:


> I definitely find it pretty worrying that these are business sales jobs which are being moved. This is not manufacturing, nor is it admin and support. I work in sales in a major multinational and up till now have felt reasonable safe in hoping that customer facing sales jobs would hardly be moved elsewhere. Sangster - is this the case, did they move field sales jobs to Scotland?


 
Hi AnnR

If you know the set up in there - PAD as a division a year ago had about 120 staff, it's now down to less than 30 and with the changes that were made to their pay plan today I would be amazed if they had 20 people at the end of next quarter.  If that was the case it won't make sense to keep them in Cherrywood.


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## Purple

aircobra19 said:


> How are the two linked?



When a large proportion of the population get pay increases it makes the country less competitive as pay costs have gone up. In the case of Ireland over the last 10 years the big increases have been awarded in the public sector where, for the most part, there has been no corresponding return on that investment in the form of improvements in services or increased capacity. The country has spent a great deal and got very little back in return. This costs jobs in the private sector as they are exposed to international competition and the general cost-base of the whole country impacts on them first.


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## aircobra19

I would also have said that the rise in the cost base in Ireland is far more related to the over fuelled property boom, that was let run unchecked, when it was obvious there was a problem with it. Thats hardly the Public sectors fault. Its the Govt fault. Certainly the cost of the public sector is a contributory factor to a rising cost base. But its laying it on a bit thick to suggest its the primary reason for some one like Dell to try and reduce their costs WORLDWIDE.


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## Desperate D

well said , the bloated public sector couldnt have awarded itself fat pay rises without the  tax revenue from the property bubble. Nobody really paid much attention to the the huge waste in government expenditure until the bubble popped and people started worry about their jobs


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## Purple

aircobra19 said:


> I would also have said that the rise in the cost base in Ireland is far more related to the over fuelled property boom, that was let run unchecked, when it was obvious there was a problem with it. Thats hardly the Public sectors fault. Its the Govt fault. Certainly the cost of the public sector is a contributory factor to a rising cost base. But its laying it on a bit thick to suggest its the primary reason for some one like Dell to try and reduce their costs WORLDWIDE.


I always thought that there was little difference between people releasing equity on their homes to pay for current expenditure and the government giving pay increases based on receipts from a capital tax bubble.


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## ClubMan

I haven't read this thread in full but I just thought it was funny to juxtapose the first and last posts at the time of my post. How on earth did one lead to the other...?


Firefly said:


> Heard this morning that Dell are cutting 450 jobs in Ireland. I think this will have a major knockon effect to the wider economy. Won't be long before the other multi-nationals take notice and review the cost of doing business in ireland....hold on tight folks & keep the SSIA money for emigration!





Purple said:


> I always thought that there was little difference between people releasing equity on their homes to pay for current expenditure and the government giving pay increases based on receipts from a capital tax bubble.


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## Purple

ClubMan said:


> I haven't read this thread in full ..... How on earth did one lead to the other...?


Read the thread in full


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## aircobra19

Purple said:


> I always thought that there was little difference between people releasing equity on their homes to pay for current expenditure and the government giving pay increases based on receipts from a capital tax bubble.



I don't really understand your point tbh. Thus not really understanding it I would have said one was a loan/credit the other cash. I can't see what it has to do with the thread topic either. 

For that matter, and I'm repeating myself, I don't get what the public sector has to do it either with considering the scale of Dell operations worldwide. 



> ...The 250 job cuts, from a total Irish workforce of 4,500, are part of Dell's wider organisational change across its European, Middle East and African (EMEA) operations. Overall, around 850 staff are being let go from Dell's 17,500-strong workforce in the EMEA area....





Problems with the public sector (vast and many) are as much a symptom rather than a major contributer to the cost base in Ireland and problems with the economy in general. Considering that in many areas you can't attract staff into the Public sector because wages are better in the private sector. Thats mainly my own direct experence than, the popular mass media and public  opinion of massive wages far beyond the private sector.


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## Purple

aircobra19 said:


> I don't really understand your point tbh. Thus not really understanding it I would have said one was a loan/credit the other cash. I can't see what it has to do with the thread topic either.


 Both fund current expenditure from a source that is not sustainable.



aircobra19 said:


> For that matter, and I'm repeating myself, I don't get what the public sector has to do it either with considering the scale of Dell operations worldwide.


 The thread developed (as many do) into a discussion on the future of foreign direct investment in Ireland. Given that the investment took place because we were cheaper than the former locations it is logical that if we get too expensive they will move to a lower cost economy. Since the public sector constitutes a large segment of the workforce when they get pay increases it has a detrimental impact on our cost base. The same is true in the private sector but there are many mechanisms for pay to drop as well as rise in that sector whereas there are none in the public sector.
This does not in any way imply that those in the public sector are overpaid and/or do not deserve their pay, it is simple economic reality.



aircobra19 said:


> Problems with the public sector (vast and many) are as much a symptom rather than a major contributer to the cost base in Ireland and problems with the economy in general.


 I think they are both part of the problem and a symptom. 


aircobra19 said:


> Considering that in many areas you can't attract staff into the Public sector because wages are better in the private sector. Thats mainly my own direct experence than, the popular mass media and public  opinion of massive wages far beyond the private sector.


 There has been a massive increase in staffing levels in the public sector over the last ten years. Any organisation that hires tens of thousands of people will have problems filling all of the posts. This does not necessarily mean that pay levels are too low.


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## aircobra19

Sorry I don't get it. I don't see how Dell cutting jobs worldwide, say for example Middle East and Africa are the result of the cost of the Public Sector in Ireland. Because thats the link thats being made here. Probably the poor uptake of Vista worldwide is more significant to Dell, or Apples increase sales in Laptops etc. I'd also have assumed that wage costs in the Private Sector has a bigger effect on Dells cost base than wages in the Public sector.



Purple said:


> ...
> There has been a massive increase in staffing levels in the public sector over the last ten years. Any organisation that hires tens of thousands of people will have problems filling all of the posts. This does not necessarily mean that pay levels are too low.



Your making a generalisation, where I was talking about my direct experience with specific roles.


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## evan

aircobra19 said:


> I don't really understand your point tbh. Thus not really understanding it I would have said one was a loan/credit the other cash. I can't see what it has to do with the thread topic either.
> 
> For that matter, and I'm repeating myself, I don't get what the public sector has to do it either with considering the scale of Dell operations worldwide.
> 
> 
> 
> 
> 
> Problems with the public sector (vast and many) are as much a symptom rather than a major contributer to the cost base in Ireland and problems with the economy in general. Considering that in many areas you can't attract staff into the Public sector because wages are better in the private sector. Thats mainly my own direct experence than, the popular mass media and public opinion of massive wages far beyond the private sector.


 
thats simply not true almost all studies have shown that the public sector by and large is better paid than the private sector even without taking into account security of employment and pensions. It is simply not the case that it is difficult to recruit into the public sector it is now one of the most desirable places to work because of the above points, there maybe difficulty in recruiting highly skilled specialities especially in health but thats the case worldwide, also the practice of in house recruiting rather than opening it up to everyone is another factor. There is no problem recruiting into the lower entry levels, it is only at the very top levels that the private sector may outstrip the public sector


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## aircobra19

So my own experience is not true. I must have imagined it then.


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## Purple

aircobra19 said:


> So my own experience is not true. I must have imagined it then.



I think it may be more the case that your experience is anecdotal and is not indicative of a national trend.


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## aircobra19

I thought by qualifying what I'd said, as direct experience and specific roles, I'd made that point. 

I can't see that many of Dells core skill set in Sales, Marketing, IT, manufacturing would be directly applicable to the Public sector, at the lower entry levels. Even the higher level for that matter. I'd have assumed that the policy of "in house recruiting" would also be a natural barrier to poaching people from the private sector.


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## Complainer

aircobra19 said:


> I'd also have assumed that wage costs in the Private Sector has a bigger effect on Dells cost base than wages in the Public sector.


Aircobra is right to be confused by those who blame Dell's job cuts on public sector wages. Indeed, the knee-jerk almost Pavlovian reaction of some AAM posters who blame everything from bad weather to Dell job cuts on public sector wages is getting seriously tiresome, given the lack of any evidence of even the most tenuous links between the two.

Any independent observer would conclude that the wages paid to Dell staff was the key factor here, not the wages paid to those who process their P45s. But let's not let common sense get in the way of a good rant. Keep the agenda rolling on....


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## Purple

Complainer said:


> Aircobra is right to be confused by those who blame Dell's job cuts on public sector wages. Indeed, the knee-jerk almost Pavlovian reaction of some AAM posters who blame everything from bad weather to Dell job cuts on public sector wages is getting seriously tiresome, given the lack of any evidence of even the most tenuous links between the two.


 I have yet to see any post that blames the public sector for bad weather.



Complainer said:


> Any independent observer would conclude that the wages paid to Dell staff was the key factor here, not the wages paid to those who process their P45s. But let's not let common sense get in the way of a good rant. Keep the agenda rolling on....


 If you give a very large proportion of the workforce large pay increase (which may or may not be deserved; that’s not the issue here) there will be a knock-on effect in the rest of the economy. If anyone does not see this they do not understand basic economics. This knock-on is what is being discussed. I do agree that general pay increases in non-competitive sectors of the private sector (like construction used to be) have has as much if not more of an impact but whereas these private sector sectors (like construction) are self –correcting during a downturn the public sector is not. This is also self-evident.   

I am not trying to pick a fight Complainer; I have the height of respect for you, but please try to see the context.


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## Complainer

Purple said:


> If you give a very large proportion of the workforce large pay increase (which may or may not be deserved; that’s not the issue here) there will be a knock-on effect in the rest of the economy. If anyone does not see this they do not understand basic economics. This knock-on is what is being discussed. I do agree that general pay increases in non-competitive sectors of the private sector (like construction used to be) have has as much if not more of an impact but whereas these private sector sectors (like construction) are self –correcting during a downturn the public sector is not. This is also self-evident.


THis is a chicken and egg arguement. Did the public sector increases cause the private sector increases, or was it perhaps vice versa?


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## aircobra19

The point is theres other factors which have a bigger impact here, than public sector pay, in the context of a global company shedding staff globally. So this thread shouldn't be focused on Public Sector as much as it does. 

In theory benchmarking should allow a reduction in Public Sector Pay. But as the increases were so delayed that some sections didn't even get their full increments, I can't see thats going to happen easily. 

Why am I reminded of mortgage lenders who can pass on increases in rates instantly but can take weeks even months, to pass on reductions. 

Will the Govt tackle problems with the economy including the problems in the Public Sector? I suspect, they'll fire fight the issues as they erupt in crisis.


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## Howitzer

Unfortunately it looks like the "doom and gloom merchants" who engaged in "useless speculation" have been proved right.

Dell is to cut its workforce in Limerick by around 1,900.
[broken link removed]


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## shnaek

It was niave to think the plant would continue to operate once the investment was made in Poland. The smart money went to Lodtz. Dell lifted Limerick in the 18 years it was there, and it will do the same for Lodtz. 
I remember going in to a music shop when I was living in Limerick in the earlier part of this decade. The owner and I had a chat, and he said he'd shut down the shop the day Dell announced it was leaving. He said there would be no point in hanging around. That's how seriously he took Dell's impact on Limericks economy. I'll be interested now in seeing if he follows through. A bad day for Limerick. Hopefully they'll be able to react like Galway did when they lost Digital.


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## ccbkd

Nothing to do with Doom & Gloom merchants , part of the world economic slowdown and global search for more competitive markets in this case Poland Cost base is cheaper and therefore more attractive to Dell


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## gflood

Apparently many of the positions filled there are by foreign nationals. So they will just go to where the work is. The knock on effect is worse than the initial 1900 that's for sure.

BUT wouldn't it be great if we lived in an efficient country where a competent government would use the plant to make Irish laptops and desktops. Those components are sourced from China and Taiwan and assembled in Limerick. I would buy an Irish made & branded laptop in the morning if I had a chance. Why does it have to have a Dell badge on it? A friend of mine in an importer of such parts for small oem builders here and there is a thriving market locally and in the UK for such machines.

Problem is that you would need some capital to get started. Does Dell own that building?

I hope that out of the 1900 we get some folk who go at it themselves and become successful (as happened in Cork after Digital).

And remember Microsoft or Apple for example were total manufacturing sites in the late 80's and let a ton of staff go. As its operations changed here they hired three times the number back. Since Dell left 1000 there they see some value in the site so maybe it will grow again on the remaining expertise.

Dont expect Dell to remain in Poland for too long either. Cost base is rising rapidly there too.


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## podgerodge

should government departments and public service organisations now cancel any contracts they have with Dell for the upkeep and replacement of thousands of computers - and source them from companies providing jobs for Irish workers?

I think so.


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## Howitzer

podgerodge said:


> should government departments and public service organisations now cancel any contracts they have with Dell for the upkeep and replacement of thousands of computers - and source them from companies providing jobs for Irish workers?
> 
> I think so.


Ah yes, spite, that should be the top priority in how our Public bodies source their IT infrastructure. I'd put it right up there with nepotism, cronyism and the brown envelope in the "how what we run our country" stakes.

Kudos, you seem to have a fine grasp on the big picture.


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## Sunny

podgerodge said:


> should government departments and public service organisations now cancel any contracts they have with Dell for the upkeep and replacement of thousands of computers - and source them from companies providing jobs for Irish workers?
> 
> I think so.


 
What, even if it costs twice as much to go to another company? Why exactly do you want to get even with Dell anyway?. They are still one of the Country's biggest employers even after yesterdays job losses and you want to punish them. Bizarre.


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## Purple

*Re: Dell job cuts..wider imnplications*



Purple said:


> I think it's more than likely that Dell in Limerick and Seagate in Derry will both be gone in 5 years.


 From June 2006. I should have put a bet on it!


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## podgerodge

Howitzer said:


> Ah yes, spite, that should be the top priority in how our Public bodies source their IT infrastructure. I'd put it right up there with nepotism, cronyism and the brown envelope in the "how what we run our country" stakes.
> 
> Kudos, you seem to have a fine grasp on the big picture.



Well if 'spite' means that Public bodies show support for Irish jobs rather than Polish jobs I am personally all for it.  And I'm sure plenty of people in Limerick right now would agree with me.  But I'm happy for you that "your grasp of the big picture" is obviously the right one.



Sunny said:


> What, even if it costs twice as much to go to another company? Why exactly do you want to get even with Dell anyway?. They are still one of the Country's biggest employers even after yesterdays job losses and you want to punish them. Bizarre.



I don't "want to get even with Dell".  I simply believe that Irish jobs should be supported by Govt Depts/Public sector organisations.  I don't believe that it would cost "twice as much to go to another company".  But I do believe, that given the amount of business they could put towards Irish companies, and given the fact that this would possibly save some job losses from the other sectors that depend on the now defunct Dell manufacturing jobs, it would be worth paying a little more to companies providing Irish jobs given the benefits to Ireland as a result.

Dell will, and have to, put profit first.  So that's what they have done.  The Government should put Irish jobs first.  Hence my opinion.


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## Sunny

podgerodge said:


> I don't "want to get even with Dell". I simply believe that Irish jobs should be supported by Govt Depts/Public sector organisations. I don't believe that it would cost "twice as much to go to another company". But I do believe, that given the amount of business they could put towards Irish companies, and given the fact that this would possibly save some job losses from the other sectors that depend on the now defunct Dell manufacturing jobs, it would be worth paying a little more to companies providing Irish jobs given the benefits to Ireland as a result.
> 
> .


 
Grand stuff. So you will have no problem with other European Countries telling all our companies who tender for State contracts abroad that they are not getting the work because they have to go to domestic companies. Do you know how many Irish jobs that will cost? We will just ignore the fact that it is illegal for a Government to favour domestic companies for State contracts.


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## Purple

podgerodge said:


> Dell will, and have to, put profit first.  So that's what they have done.  The Government should put Irish jobs first.  Hence my opinion.


If the Irish government did what you seggest they would be in breach of EU law. 
You should also consider what would happen to a country like Ireland, which exports so much of what it produces, if the US government took the same stance you advicate when so many of their companies shed staff and relocated to Ireland in the 80’s and 90’s.

_Post crossed wih Sunny_


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## podgerodge

Sunny said:


> We will just ignore the fact that it is illegal for a Government to favour domestic companies for State contracts.





Purple said:


> If the Irish government did what you seggest they would be in breach of EU law.



Point taken.  Ahh sure we will be on the way out of the EU when we vote 'No' again to Lisbon, or so our representatives are saying.


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## Sunny

podgerodge said:


> Point taken. Ahh sure we will be on the way out of the EU when we vote 'No' again to Lisbon, or so our representatives are saying.


 
Or when they kick us out for having a basket case economy!


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## redstar

US multinationals tend to do things as a herd. 

Following on from Dells bad news, IBM might be next ...
http://www.siliconrepublic.com/news/article/12068/business/layoff-rumours-surround-ibm


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