Ireland’s allure as a top destination for tech talent is fading. This mature delivery hub for nearshore IT services still has much to offer but will have to overcome key obstacles to regain its appeal among international technology professionals. Gain market insights and forecasts for Ireland’s tech talent in this blog. To discuss this topic further, contact us.
In recent years, Ireland has been a magnet for job seekers worldwide, luring talent from diverse nations such as England, India, Brazil, the United Arab Emirates, Turkey, Sri Lanka, and Bangladesh. The country’s appeal as a destination has been fueled by abundant job opportunities, excellent quality of life, simplified work permit processes, and enticing government initiatives such as the Critical Skills Employment Permit and the Start-up Entrepreneur Programme (STEP). However, against the backdrop of a tech sector slump and a demand-supply disparity, Ireland is gradually losing its allure for foreign technology professionals.
Ireland has been a popular location for global companies looking to offer IT service delivery to nearshore Europe. Ireland’s diverse offerings encompass application development, infrastructure management, and other digital services. The nation’s strong talent proposition is underscored by 52,000 tertiary graduates and a thriving information technology and business processes (IT-BP) workforce, totaling 157,000 employees. The cities of Dublin, Cork, and Galway serve as prominent IT-BP hubs, contributing about 80% of the nation’s center setups, with global business services (GBS) making up the majority share at 75% of the total center setups.
While Ireland has been a preferred choice for job seekers, its appeal is waning among overseas technology talent due to various reasons. A surge in remote work options, prompted by the post-COVID era, has opened up alternate global work setups. Concurrently, factors like high living costs, housing constraints, a technology workforce demand-supply gap, and muted global tech sector growth contribute to this trend’s acceleration. Additionally, metro areas like Dublin confront issues with a dearth of international schools and high-income tax rates. Government efforts to alleviate these concerns are geared towards improving living standards through sustainable pay increases.
While programs such as Ireland’s Critical Skills Employment Permit and STEP are designed to attract and retain foreign talent. However, the acceptance and success of remote work have reshaped the scenario, making local talent shortages a thing of the past. Technology companies are tapping into the global talent pool through remote hiring, sidestepping relocation challenges.
These growth-related challenges are reflected in our ongoing tracking of IT job demand in Ireland through Talent Genius™, an interactive platform for insights into IT and business process services decisions. The talent demand for IT services has seen a relative reduction since January 2022, as illustrated below. This decline was most pronounced in the last quarter of 2022, driven by tech sector contraction, economic uncertainty, and job cuts. Although some signs of recovery appeared mid-year, the market dynamics have shifted from employee-led to employer-driven, reflecting cautious hiring practices.
Monthly tech talent demand (job postings) for IT services (indexed to January 2022)
January 2022 = 100
Ireland boasts an operating cost advantage of 20-25% over London for IT application development and maintenance (IT-ADM) services. Nonetheless, tech salaries have remained steady in the first quarter of 2023 compared to the fourth quarter of 2022, reflecting a competitive yet inflexible market due to talent oversupply. Layoffs and conservative hiring practices have suppressed salary competitiveness. But as the market stabilizes, salary stickiness is expected to improve.
As global dynamics shift, Ireland’s position as a tech talent magnet has encountered new hurdles, and the inflow of international tech talent to Ireland is likely to decline in the short term. Nevertheless, with an upward trend in job numbers and signs of a tech sector revival, the second half of 2023 will hold pivotal insights into the future of Ireland’s technology workforce. Addressing challenges related to remote work, housing, taxation, and competitiveness is crucial to regain its appeal as a tech employment destination.
Be on the lookout for more talent information on other nations by clicking on our interactive platform, Talent Genius™. Connect with Sakshi Garg or Aarushi Raj to discuss the latest trends in tech talent.