Brexit – An Irish perspective

By Mary Connaughton, Director CIPD Ireland

When I searched the term ‘Brexit’ on Google today, I found over 180,000,000 results. That is a lot of column inches. Interestingly, Ireland is second to the UK in the number of Brexit searches on Google, followed by Singapore and Luxemburg!

The analysis and commentary from Ireland and other EU and European countries have been different from that of the UK’s, expressing different concerns and facing different issues around competitiveness and mobility.

As the UK’s the nearest neighbour, the island of Ireland is closer than we sometimes realise – there are only 12 miles between Northern Ireland and Scotland, and only 40 miles of sea from Fishguard, Wales to Wexford in the south east. We have a long and complex history, and our economies, families and labour markets are heavily intertwined.

In the run-up to the British referendum, the Republic of Ireland was identified by the World Economic Forum as the country most at risk of suffering reduced economic growth as a result of Brexit, so we now face lower growth forecasts, though at a time of economic growth.

In Ireland we are engaging with CIPD members to support them on workforce and workplace challenges as they emerge.

The environment
The macro economic environment impacts HR and the workplace in every country, but especially in Ireland where we have a small, open, export-led economy. At present, high levels of uncertainly, exchange rate volatility and competitiveness pressures are challenging HR around the cost base of Irish business. Pay and pensions costs are a high percentage of most organisations’ cost base, and we know these are being monitored much more tightly.

With exports from Ireland to the UK valued at over €1 billion a week, and Irish owned companies exporting 44% to the UK, building skills capability in export marketing and languages has emerged as an immediate key area of focus to reduce our dependence on the UK market.

The common trade and travel area between UK and Ireland, which preceded the EU, is under threat, and it is not feasible to think that it won’t change in some form. The question is the extent and implications of that change – the likely rights of Irish and EU residents to travel and work in both Northern Ireland and the UK, and vice versa. It is estimated that 30,000 people travel daily across the border between the north and south of Ireland, working in a different jurisdiction to where they live, and up to now this flexibility has served both economies on the island well.

Every cloud has a silver lining, and as Ireland is the only English-speaking country in the Eurozone, we may benefit from companies wanting to set up a new European hub here. This would be great for jobs, but add to the competition for high skills and property, and increase risks around staff retention and payroll costs.

Workforce and HR
While a waiting game may be played on triggering Article 50 of the Lisbon Treaty, to be followed by time-consuming negotiations, there will be a lot of speculation on what is going to happen. Whatever the outcome, the HR profession throughout Europe and the UK will be swamped with trying to keep up-to-date with regulatory changes affecting the workplace and the workforce, such as immigration and data protection. All likely to add to costs and bureaucracy!

Workforce mobility in Ireland and internationally is going to change in unidentifiable ways after Brexit – the regulations, the corporate response and employee behaviours.

Right now as a profession, each of us can add value by understanding the real risks likely to affect our business sector and company, and building the organisation’s capability to operate in a more competitive and cost effective way.

I believe now is the time for HR to show strong leadership and place a clear focus on supporting employees and maximising the organisation’s capability to:
• adopt a learning environment where innovation and critical problem solving help to resolve emerging business dilemmas and take advantage of opportunities;
• streamline knowledge management processes so leaders and employees can access the critical external information they need as it emerges;
• better manage uncertainty and change.

On 8 September, we are consulting with CIPD members in Ireland to identify specific concerns and supports needed on workforce and workplace issues. For details contact info@cipd.ie.

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