Why Ireland's tech hub status makes it a great outsourcing destination
With its lush green hills and valleys, Ireland has always been a fertile country for farming. But, with its central geographic location, relatively easy access to the rest of Europe, the U.S. and the Middle East, and EU status, the country has become a business growth center as well.
Over the past several decades, Ireland has transformed into a bona fide European tech hub, catering to early-growth and established tech brands alike. The Silicon Docks neighborhood in Dublin is home to more than 7,000 tech workers from companies like Google, Facebook, Twitter and LinkedIn. Meanwhile, areas like Blackpool in Cork have helped the city become the top Irish location for successful tech start-ups like Teamwork and Xanadu. The country also hosts offices and operational centers from companies like Apple, Airbnb, Eventbrite, Blizzard and Etsy, among others.
Ireland didn't become a tech powerhouse — nor a leading outsourcing destination – overnight. Many of the factors contributing to Ireland's appeal, like a clear, compelling tax structure, have been in place for decades now. But after a strong recovery from the 2008 recession to go with a critical mass of tech infrastructure and start-up success, Ireland has emerged as a true global player.
For companies looking to increase competency and reduce costs in a legitimate, world-class tech environment, Dublin and Cork should be high on the list. Here are a few of the reasons why:
Economic and population growth
Ireland's domestic economy is expected to grow by 4% in 2019, according to the country's Economic and Social Research Institute. That's a healthy growth rate globally, especially when you consider the real GDP in the U.S. is projected to increase by 2.3%, according to the U.S. Congressional Budget Office.
Figures from the Quarterly Dublin Economic Monitor also show unemployment in Dublin is now below 5%, from a high of 13% in 2008. For its part, Cork has already experienced a 63% increase in employment in tech companies over the last several years, with more than 13,000 workers employed in the sector, according to industry association IT@Cork. These economic factors, coupled with the country's unique position as the only English-speaking country within the Eurozone, make Ireland an attractive destination for companies moving into Europe.
Young, skilled, global workforce
Dublin is ground zero for Irish start-ups, but has also attracted its share of large, multinational tech companies. Google set up shop in Dublin in the early 2000s, after a host of other Silicon Valley heavyweights put down roots in the city. “Having a cluster of tech firms makes Dublin an attractive place to work as people know that they will have a choice of companies to work for," says Graeme McQueen, head of communications at the Dublin Chamber of Commerce.
That's a great advantage when looking to attract top-talent interested in career advancement and opportunity, especially considering Ireland has the youngest population in the EU, with over 33% under the age of 25. Dublin's workforce is also markedly young, with 40% of people living in the city under the age of 30, says McQueen.
This young, educated workforce offers companies skilled team members, with a breadth of language capabilities. “The fact that so many large multinationals have based themselves in Dublin over the past 20 years means the city has a skills-rich workforce," says McQueen.
Ease of doing business
In addition to a strong economy and a highly skilled talent pool, Ireland provides many other advantages. For one, there's a post-recession abundance of office space, says McQueen. “The Irish economy has recovered well over the past decade and we're now in the great position of having a good supply of world class office space in Dublin," he says.
Low-cost airlines operating out of the U.K. and Europe also make getting in and out of Ireland a breeze. On top of that, “Dublin Airport is now one of the best-connected airports in Europe," says McQueen. “It's great to see more and more direct flights being added between Dublin and major American cities and also the likes of China and Hong Kong."
And the granddaddy of cost-saving reasons to set up shop in Dublin or Cork? Ireland enacted favorable tax legislation in the early 2000s, and a steady flow of companies have gone to Ireland since. Where the corporate tax rate in the U.S. is 35%, Ireland's is 12.5%, and the country offers particularly favorable rates for revenue tied to new intellectual property and innovation — yet another reason why Ireland is such a successful tech hub.
Brexit risks and opportunities
Ireland, and in particular Dublin and Cork, is friendly to global business. Still, given its divided allegiances to the U.K. and the EU, the looming prospect of Brexit could give pause to companies otherwise eager to enter the market.
The Irish business community offers a much more reassuring perspective. “In many ways, preparing for Brexit simply requires Ireland to do the things that it would and should have been doing anyway: Improving our transport system, ensuring a steady supply of attractive and affordable accommodation and keeping the cost of living down," says McQueen.
Uncertainty around Brexit may take years to resolve. However, McQueen expects it to bring about even more opportunity for the community of innovative businesses that have increasingly chosen to call Ireland home.