The Irish employment permits system now increasingly responds to data about shortages and surpluses in the labour market, according to a new ESRI report.

The study, Determining Labour and Skills Shortages and the Need for Labour Migration in Ireland, explores the extent to which research on the Irish labour market guides economic migration policy.

It identifies direct informational links between the State bodies responsible – namely the Department of Jobs, Enterprise and Innovation, and the Skills and Labour Market Research Unit (SLMRU) in Solas –  and says co-operation has “become more formalised in recent years”.

An annual list of occupations with shortages is published by the SLMRU in the National Skills Bulletin, and this list now forms the basis of two employment permit lists produced by the Department of Jobs that determines what occupations are and are not eligible for permits.

According to the ESRI, EU-level analysis shows that Ireland is ahead of most EU member states in terms of linking labour market intelligence to labour migration policy.

Usually employment permits are only issued where an identified need exists, and incentivised permits are available to target workers with skills necessary for the economy.

Just under 5,500 of such permits were issued to non-EU workers in 2014, an increase of 42 per cent compared to 2013. Indian nationals accounted for 30 per cent of these recipients, followed by nationals of the US (13 %) and Pakistan (9%). 

Of all permits issued in 2014, almost 70 per cent were issued to professionals. The IT sector accounts for 43 per cent of the total, while 25 per cent were issued in the healthcare sector. 

Under the Employment Permits (Amendment) Act 2014, the Minister for Jobs now has more clearly defined powers and increased flexibility to adapt the system in response to changing economic conditions. 

Changes made so far include new categories of employment permits, introduced in 2014, and a more user-friendly application process designed to attract highly skilled workers.

Data constraints put some limitations on what information is available to Irish policymakers, such as estimating the availability of skills, the number of vacancies and supply of graduates within the EU.

But overall, the ESRI report claims that Ireland “stands out for attempting to link almost all types of employment permits to identified labour market shortages”.

Commenting on the findings, report author Emma Quinn said: “One aspect of Ireland’s broad economic policy is to attract and support high value-added investment, often in narrow occupations and fields such as ICT or pharmaceuticals. This can create skills demands that are difficult for the domestic labour force to meet.

“While up-skilling the resident population is the priority, non-EU migration can allow for a quick response to emerging skill shortages and provide an ongoing supply of skilled workers where the number of graduates remains too low.”

Quinn adds that “Ireland has taken an innovative, incremental approach to identifying skills and labour shortages. This study shows that the employment permits system is now well linked to such information as it emerges.

“The responsiveness of the employment permits system to labour market intelligence is becoming increasingly important as the economy continues to improve and labour market shortages are more widespread.”