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15th/16th February 2018
Addressing the Skills Needs Arising from the
Potential Trade Implications of Brexit
Expert Group on Future Skills Needs Workshops
Expert Group on Future Skills Needs
Independent, non-statutory body, established in 1997
Includes representatives from business, education and training providers,
trade unions and a small number of Government departments and agencies
Secretariat based in Department of Business, Enterprise and Innovation
Advises the Government on future skills requirements and associated labour
market issues, that impact on national potential for employment growth
Undertakes research, analysis and horizon scanning in relation to emerging
skills requirements at thematic and sector levels
Engages with Department of Education and Skills, Higher Education
Authority and SOLAS and other relevant bodies to produce an agreed action
plan to address the skills needs identified
_______________________________________________________________Department of Jobs, Enterprise and Innovation | Strategic Policy Division
Context of workshop- 1
https://dbei.gov.ie/en/Publications/Building-
Stronger-Business-Responding-to-Brexit-by-
competing-innovating-and-trading.html
• Contingency planning for
potential fallout from Brexit-
DBEI focus on helping firms to
compete, innovate and trade in
post-Brexit environment
• Range of DBEI research directed
towards understanding Brexit-
establishing the evidence base
• Purpose of study- to examine
whether Irish based enterprise
is adequately equipped from a
skills perspective to address the
potential trade challenges
posed by Brexit
Context of workshop- 2
(1) UK departure from Single Market and Customs Union- could bring new
border controls, barriers, resulting administrative/technical requirements for
Irish trade into and from UK market
Also questions around continued viability of UK landbridge as channel for
Irish trade
o Impact on efficiency of trade flows, creating disruption, additional business
costs, impacting on supply chains
o Freight Transport, Distribution and Logistics sector- key enabler of trade for
Irish based enterprise
(2) Also onus on diversification of Irish trade away from UK market to offset
potential impacts
Seeking out non-traditional markets may present other trade related
barriers and regulatory challenges for Irish based enterprise
_______________________________________________________________Department of Jobs, Enterprise and Innovation | Strategic Policy Division
Revisiting of previous EGFSN reports (trade related
skillsets)
• 2012’s Key Skills for Enterprise to Trade Internationally
o Focus on skills related to global/international management, sales, marketing, customer support, design and development, logistics/distribution, foreign languages/cultural awareness (i.e. trade diversification skillsets)
• 2015’s Addressing the Demand for Skills in the Freight Transport, Distribution and Logistics Sector, 2015-2020
o Focus on skills related to Freight Transport/Logistics (especially HGV driver shortage), trade compliance, Supply Chain Management (i.e. trade facilitation skillsets)
Current Exercise- 1
• Through current study- assess the progress, through
development of an adequate skills base, in implementing the key
recommendations of those reports, prepared at a time of less
potential for restrictive, complex and disruptive trading
arrangements with a key market and channel for Irish trade
• What other issues have arisen?
o e.g. Enhanced provision and programmes in international
management/sales/marketing/supply chain management,
introduction of foreign languages strategy, professionalization
and enhanced attraction of FTDL sector as a career option (e.g.
development of apprenticeship programmes for HGV drivers,
Logistics, enhancement of training for Customs Clearance/Freight
Forwarding)
Current Exercise- 2
• Undertaking of comprehensive research exercise in current study (engagement with enterprise sector)
• Stocktake and update these two reports, establish exact state of readiness of Irish based enterprise from a skills and competency perspective
• Expected outcome of study: preparation of an evidence based action plan that can be drawn upon and implemented
• Contribute towards development of the trade related skills base in Ireland, and its accessibility to enterprise, in a manner that:
o Helps Irish based enterprise navigate the potentially more complex and diverse trading environment post-Brexit
o Enhances the efficiency of trade flows, competitiveness and diversification into new markets
o Helps to grow and sustain employment
Qualitative Research- Study Sample
• Engaged with 64 internationally trading enterprises and firms within the wider Freight Transport, Distribution and Logistics sector, including key informants relevant to both areas, to determine:
o the potential impact of Brexit on their business
o their existing and prospective trade related skills needs
o how these needs could best be addressed
• Internationally trading enterprises concentrated in sectors identified by Government Trade Strategy (Ireland Connected) as ‘sectors of comparative advantage’ for Ireland- in particular Agri-Food, Health Lifesciences, Technology, High Value Manufacturing, Construction Services
• FTDL firms- included Third Party Logistics Providers, International Road Freight Transport Companies, Consultancy Firms providing Logistics Services as significant part of their business activity, Operators involved in intermodality and co-modality logistics activities
Purpose of Workshops
One of two identical workshops being held this week- one in Dublin and
one in Cork
Key role in qualitative research phase
Gather together Internationally Trading/FTDL stakeholders from industry,
policy and research
Main goals:
o To discuss and validate the preliminary results of the study
o To discuss the potential impacts of the key findings
o To brainstorm and discuss the measures that should be taken in order to
boost the availability of the relevant trade related skillsets in Ireland
Workshop Agenda
Addressing the Skills Needs Arising from the Potential Trade Implications of Brexit- workshop
Agenda
12.30 Registration, Tea and Coffee
13.00 Opening and Welcome by DBEI
13.10 Keynote 1 Overview of Study Findings- Internationally Trading enterprises
Keynote 2 Overview of Study Findings- Freight Transport, Distribution and Logistics Sector
13.30 First Breakout Session: Validation of study findings
14.30 Reporting of breakouts to plenary
14.45 Tea and Coffee Break
15.00 Second Breakout Session: Measures to address issues and opportunities
16.00 Reporting of breakouts to plenary
16.15 Wrap up and conclusions (AECOM and DBEI)
16.30 End of workshop
International Traders
Findings – International Traders
• Spoken to organisations across Construction, Agrifood, Technology, High Value Manufacturing, Health Lifesciences
• Key informants
• Reviewed Brexit specific documents, reports, policy statements, impact studies, articles etc
• Changes in skills requirements
• Particular challenges of Brexit (broken down by sector)
• Planned mitigation and suggestions for support from Govt and training and education providers
Approach – International Traders
• Size of the organisation
• Revenues across key markets
• Customs skills
• How transport goods
• Impact on business and subsequent changes to MO
• Changes in ability to recruit
• Support
Telephone Interviews
Agri-food
• Wide range of activities
• Rapidly growing global population and changes in
consumer preferences due to a burgeoning middle-
class in emerging markets
• The retail of agri-food produce is dominated by a
small number of large retailers
• Highly dependent upon the export market
Sector Profile
Agri-food
• Integrated UK&I manufacturing (e.g. packaged)
• Time to market is a critical factor
• Places limitations on the geographical reach of certain
products
• Market where Brexit has already been seen to have an
impact (currency)
• Small companies less likely to have awareness of non-
tariff barriers as they tend to depend on outsourcing
logistics
Agri-food
• Customs: H&S, TARIC
• Regulatory Divergence: Tailoring products to reflect specific market regulations.
• Supply Chain Auditing
• Sourcing
• Trade Financing: Managing VAT
• Languages: Translation, business, N.A. + Asia: French, Mandarin
• Cultural: non-verbal communication and awareness.
• Food Scientists/Meat technicians
Identified Skills requirements
Agri-food
• Northern Ireland a key market and seamless supply
chain with Ireland – Big shock
• Difficulties reported in exporting to 3rd countries
• Larger organisation – more proactive
• Suggestion that less business will be done with UK
• Big challenges with exploiting new markets
• UK a unique market (e.g. Cheddar)
Feedback
Technology
• Can be subdivided into three sub-sectors:
o Software Products and Services
o Electronics, Hardware and Firmware,
o IT-Related Services
• Software increasingly cloud based
• Much hardware production has moved abroad
• …but not Supply Chain Management functions
Sector Profile
Technology
• Products often air freighted as high value
• Dangerous goods
• Larger multinationals have dedicated global trading
teams
• Smaller organisations likely to use 3PL
• Concerns over regulatory divergence
Sector Profile
Construction
• Composed of companies producing physical goods, and support services
• Products include timber products, building systems, insulation products and fittings
• Demand for construction products and services is anticipated to shift toward South-East Asia and other developing markets
• Worries that there is an oversupply of offices in Dublin
• 55% of Ireland’s timber and construction sectors’ exports to UK
Sector Profile
Construction
• Construction output is currently estimated to be at 2001
levels, employing over 140,000 people
• Grappling with sourcing adequate levels of trades/
professions to fill important vacancies
• Number one issue lack of skilled tradespeople
• Apprenticeship uptake low
• Brexit may increase demand for office space in Dublin
• …but has created uncertainty
Sector Profile
Health Lifesciences
Sector Profile
• Latest contributor to corporation tax receipts in the
goods sector
• Highest level of profit per employee
• Ireland is a globally recognised centre of excellence
• Employs over 50,000 people directly and exports
over €445 billion annually
Health Lifesciences
Sector Profile
• High margin and time sensitive – air freight
• Engaging partners to explore alternative
arrangements and tackle regulatory
divergence/requirements
• Less exposed to UK market than other sectors
• Limited availability of cold chain storage
High Value Manufacturing
Sector Profile and findings
• Ireland provides a competitive high value
manufacturing location
• Likely to undergo significant disruption over the
next number of years due to the development of
new technologies
• Often multinationals with SCM centres in Ireland
• Varying levels of exposure to UK market
• Data Analysts and supply chain specialists
FTDL Sector
Sector Profile
Finding – Roles difficult to recruit into
• Drivers, drivers, drivers!
• Supply Chain Management roles
• Operations
• Sales and Marketing
• Customs Clearance
• Not just bodies through the door – quality
• Consistent with 2015 findings
• Perception of sector
• Turnover
Exposure to UK market
• Mixed response to survey
• Those most exposed to UK looking at other markets
(EU predominantly)
• Multinationals less exposed, but concerned
Impact of Hard Brexit
• “Very negative impact”
• “Minimal at the moment”
• “Unsure”
• “positive…customs clearance expertise is likely to become more in demand”
• “Will materially we change the way do business”
• Very negative impact – company is shutting down and Brexit is a major factor in this
• Exposed to landbridge
• UK/Ireland regulatory alignment
Change in import and export markets?
• Look to explore other European markets
• Adapt
• “Wait and see”
• Little evidence that markets further afield are being
explored/considered
• Costs associated with
training/recruitment/exploring new markets
Staffing numbers and training requirements
• Modest increases reported amongst some
respondents
• Generally in relation to customs clearance
• INCO terms/AEO
• FTDL sector not significant employers of British
workers in Ireland
FDTL Findings
• Chinese walls effect
• Legal issues potential for disrupting distribution rights for UK and Ireland
• Exposed to UK market and landbridge
• Feeling that Hard Brexit would be extremely difficult…
• …but don’t believe it will happen
• Uncertainty a huge issue
• Acknowledgment that customs clearance expertise was needed
• But not currently investing in upskilling/recruitment/alternative markets
• Wait and see!
Overarching Findings
• Varying level of concern and projected impact
• Not consistent across sector, size of organization
and exposure to UK
• Uncertainty affecting understanding of impact and
skills requirements
• Little evidence of intervention by majority of
respondents to upskill or invest in new markets
• General ability to recruit has got more difficult
Overarching Findings
• Larger organisations better placed to cope with new
customs requirements (existing markets, dedicated
trading teams)
• Few mentioned divergent regulatory environment
• UK employees generally very small proportion of overall
workforce
• Language skills discussed, but intertwined with cultural
awareness
• Europe rather than other markets cited as replacement
Breakout 1: Validation of Study Findings
Breakout 2: Potential Measures
Wrap up and Conclusions