Secondary Economic Activities (Leaving Cert Geography): Revision Notes

Secondary Economic Activities

Introduction to secondary activities

Secondary economic activities involve transforming raw materials through manufacturing processes to create finished or partially completed products. In Ireland's western region, manufacturing remains significantly less developed compared to the Greater Dublin Area (GDA). This underdevelopment stems from several interconnected challenges that have shaped the region's industrial landscape.

The West relies heavily on more conventional secondary industries, particularly food processing, timber processing, and textile production. These sectors face ongoing pressures that limit the region's ability to attract modern manufacturing operations and multinational corporations (MNCs).

Factors influencing manufacturing in the West

Four primary factors significantly impact secondary industrial development in the western region: infrastructure limitations, labour force characteristics, dependence on traditional industries, and government intervention policies.

Infrastructure challenges

The western region suffers from inadequate infrastructure investment, creating substantial barriers to industrial development. The challenging upland terrain and poor drainage systems make constructing modern road and rail connections both difficult and expensive.

Transportation links remain severely limited, with only the M6 motorway (completed in 2009) providing direct connection between Galway and Dublin. Mayo and Roscommon rely on the N5 national route, much of which requires significant repair work. This inadequate transport network creates major obstacles for industries seeking efficient goods movement and access to broader markets.

The region lacks well-developed industrial estates, which represent the preferred locations for MNCs and other companies. Industrial estates typically locate near established transport corridors on urban area outskirts, making the West less attractive for such developments. These facilities provide essential utilities like electricity and water supply needed for large-scale manufacturing, along with opportunities for companies to establish beneficial working relationships.

Telecommunications infrastructure presents another significant challenge. Many western areas remain broadband 'blackspots' with no internet coverage available. Modern businesses depend on high-speed broadband connections, yet average speeds across the West fall well below both eastern Ireland and EU averages, despite recent improvements.

Ireland West Airport at Knock in County Mayo provides some access to the region, but its limited flight schedule offers little incentive for companies to establish operations there.

Labour force characteristics

The West faces considerable labour force challenges that discourage industrial investment. Population density remains extremely low at just 25 people per square kilometre, with only 30% of residents living in urban areas. Galway City, the region's largest urban centre, has approximately 70,000 inhabitants.

This sparse urban development makes it challenging for MNCs to identify locations offering adequate skilled worker supplies or sufficiently large local markets for their products.

Outward migration represents a persistent problem, primarily caused by limited third-level educational opportunities. The West contains just one university and two Institutes of Technology, prompting many students to pursue education in southern and eastern parts of the country. Students typically secure employment near their college locations rather than returning to the West, creating a brain drain effect that reduces the region's most educated and skilled population.

The concentration of educational institutions in Galway means most MNCs cluster around this city. Universities and colleges attract MNCs because they provide research and development capabilities alongside educated, skilled workforces. Companies can invest in academic programmes and fund PhD research, with graduates bringing valuable expertise to the organisations.

Traditional industries limitations

Outside Galway, industries tend to operate on smaller scales using labour-intensive production methods. These labour-intensive operations face vulnerability to job losses through rationalisation and mechanisation processes.

The construction sector's collapse following the 2008 recession demonstrates the instability of labour-intensive industries. Until 2008, building and construction activities accounted for over 50% of secondary sector employment in the West.

Manufacturing wages in the West average 15% lower than elsewhere, reflecting the region's higher levels of unskilled employment compared to the GDA. In Roscommon, approximately 57% of the workforce works in food processing industries, which remain susceptible to sudden job losses due to unstable markets or rising production costs.

The meat-processing company Kepak Ltd operates in Athleague, County Roscommon, but eliminated 50 positions in February 2014 due to economic difficulties. This downturn created knock-on effects for supplier companies like FDK Engineering, which specialises in food processing machinery for dairy and meat industries.

Government intervention effects

Government policies have significantly shaped industrial development patterns in the western region. During the 1930s, protective legislation shielded domestic industries from foreign competition, discouraging international companies from establishing Irish operations, particularly in peripheral regions like the West.

The 1950s brought policy changes designed to attract more industry through low corporation tax rates intended to draw MNCs to Ireland. However, limited companies established western operations due to poor communication infrastructure and distance from urban centres and EU markets.

Since Ireland's EU membership in 1973, the West (now part of the Northern and Western Assembly) has received Category One region status. This classification provides substantial grant support for developing communications and infrastructure systems. The region also receives structural funds for education and training programmes aimed at creating skilled workforces.

The Industrial Development Agency (IDA) offers grants and tax incentives to attract companies to western and other peripheral locations. Údarás na Gaeltachta promotes employment in Gaeltacht regions like Connemara, providing grants covering up to €14,000 per employee wage for companies establishing operations in Gaeltacht areas.

The National Development Plan's National Spatial Strategy (NSS) 2002-2020 aimed to develop several gateways (like Galway) and hubs (like Tuam and Athenry). These centres were intended to promote economic development by improving communication links and industrial infrastructure.

Despite the NSS being discontinued in 2014, designated hubs and gateways have become more attractive to industry. In 2015, Apple Inc. announced an €850 million investment to develop a new data centre in Athenry, demonstrating the continuing impact of strategic planning initiatives.

Examples of industries in the West

Industry in Westport

Westport has experienced industrial investment growth, partly due to its designation as a hub under the National Spatial Strategy. Allergan Ireland, a subsidiary of an American cosmetics company, began operations in Westport in 1977 with just 25 employees. Today, it employs over 800 people and generates over half of the company's global revenue.

Industry in Galway City

Galway City offers numerous manufacturing advantages, including a population exceeding 75,000 that provides substantial labour pools and local markets. The city benefits from developed transport connections (M6 motorway, railway, port, airport) and superior telecommunications infrastructure with broadband speeds exceeding regional averages.

Several well-serviced industrial estates operate within the city, alongside the National University of Ireland Galway (NUIG) with nearly 20,000 students providing consistent supplies of skilled graduates.

These advantages have attracted numerous IT, medical device, and pharmaceutical companies, including Hewlett Packard, Ingersoll Rand, Boston Scientific, Medtronic, and MedTech.