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Births deaths and firm survival in west cork

Thursday, 16th October, 2014 1:00am

A forum on this Friday, organised by West Cork Development Partnership (WCDP), will take an in-depth look at whether West Cork is surviving or thriving in terms of employment, economic development and innovation.

The forum takes place at Kilmacsimon and will look at the impact of the contraction of the economy, increase in emigration, the return to high unemployment, broadband connectivity and the business proposition of the region.

Among the speakers at 'West Cork: Surviving or Thriving' will be Dr Bernadette Power, Department of Economics, UCC whose research, 'Births, Deaths and Firm Survival: A Tale of Two Regions, West Cork and Kerry' draws extensively on Central Statistics Office data and records and evaluates the changes that have taken place in key economic activities, sectors and locations throughout West Cork in recent years.

Other speakers will include Justin Doran, Department of Economics, UCC; Owen O'Brien, Entrepreneur in Residence, Department of Economics, UCC and Sean McNulty, CEO, Dolmen. Patrick Neary, technical director of the National Broadband Plan will discuss the future of broadband infrastructure in West Cork.

"Myself, Ger Ryan and Justin Doran have been looking at the survival rates of firms for a number of years," she says. CEO of WCDP Ian Dempsey asked her to compare West Cork and Kerry in terms of birth rates, death rates and survival rates.

A study looking at an individual region like West Cork has never been done, as the CSO divides data into counties. Dr Power was able to analyse West Cork on its own and compare it to Kerry and Ireland generally.

Her findings suggest that Kerry and West Cork are quite similar, with very little difference in terms of industry. They also had a similar level of rural activity and tourism.

Not surprisingly, the majority of firms in West Cork that exited between 2006 and 2011 were involved in construction (27.2 per cent), but that is lower than the national average of 27.9 per cent. Next highest sector was agriculture, forestry and fishing at 18.2 per cent, much higher than the Irish average of 8.4 per cent. Third was an 8.7 per cent exit rate in professional, scientific and technical activities.

Dr Power found that the most births of firms were centred on urban areas like Bandon, Kinsale, Clonakilty, Macroom, Skibbereeen, Schull and Bantry.

The birth rate of firms was the highest in agriculture, forestry and fishing (22.3 per cent), followed by construction (17.6 per cent) and wholesale retail, repair of motors (12.7 per cent).

The recession may have seen people move between sectors, she says. Some people may have moved from construction to focus more on agriculture, for example. The birth rate of firms in West Cork was greatest in tourism, agri-food and agriculture, with rates running at over 12 per cent by 2009.

"Birth rates in Ireland haven't returned to pre-cash levels but they are recovering," Dr Power says. "Death rates in Ireland increased significantly in the period of the financial crisis.

The death rate in West Cork rose from eight per cent in 2006 to 11 per cent in 2010. Preliminary figures for 2011 suggest the death rate may have risen to 13 per cent. The UCC lecturer says there seems "to have been a washout of firms in 2011".

She adds that there was not a huge difference in survival rates between firms in West Cork, Kerry and Ireland generally. However in West Cork, only just over 50 per cent of firms which began in 2006 survived into their sixth year.

The implications of the data, she says, is that regional characteristics and resources seem to be important, with more births in agriculture and tourism in times of crisis. With the high number of small enterprises, the death of a firm can mean someone has changed to a new area.

Dr Power thinks that we should see survival rates increase and birth rates exceed death rates as the figures for more recent years come out.

The question, she thinks, is "whether West Cork can build on its strengths as the economy grows?"

The forum will take place at Kilmacsimon Community Centre on Friday 17 October from 9am to 4.30pm, and all are welcome to attend. For more information, please visit www.wcdp.ie/economicdevelopmentconference.

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