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Business In Ireland 2015

Business Performance in Ireland

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The performance of business in Ireland in 2015 was examined using a number of performance indicators. The structural business surveys ¹ were used to compile the data.

Labour productivity, personnel costs as a percentage of Gross Value Added (GVA) and enterprise profitability were analysed. The contribution of the 50 largest enterprises, both in terms of GVA and employment were also examined.

GVA represents the value of the goods and services produced, in this case, in the Irish business economy. A simple measure of productivity is to analyse GVA by the number of persons engaged. The relatively large multinational sector in Ireland and the consequent assignment of value added to the Irish economy, can make the interpretation of indicators like GVA per person more difficult.

Care should be taken when looking at the results for Micro sized enterprises. This size class covers enterprises with less than 10 persons engaged. This also includes enterprises that officially have no persons engaged assigned to them, but in some cases have significant economic value. In Figure 4.3 we can see that personnel costs relative to GVA are lower for Micro enterprises than for other SMEs.

(1) The surveys used were Census of Industrial Production (CIP), Building and Construction Inquiry (BCI) and Annual Services Inquiry (ASI). Financial and Insurance activities were excluded from this analysis.

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	Irish-owned	All enterprises
Micro <10	70379	82410
Small 10-49	47955	57675
Medium 50-249	51761	68075
Large 250+	80052	291667
	0	0
All size classes	62155	131852

Gross Value Added per person engaged averaged €131,852 for all enterprises in the Irish non-financial business economy in 2015, while Irish-owned enterprises averaged €62,155
Small enterprises reported GVA per person of €57,675, which increased to €68,075 for Medium enterprises
GVA was just over €80,000 per person for Large Irish enterprises, but rose to €291,667 when all similar sized enterprises are included

	SMEs (<250)	Large (250+)
All sectors	70713	291677
Industry	101232	784490
Construction	54688	92867
Distribution	59075	46201
Services	72558	139692

Gross Value Added per person engaged averaged €291,677 for Large enterprises and €70,713 for SMEs in the Irish non-financial business economy during 2015
In comparison to other sectors, Large Industrial enterprises reported the highest average GVA per person engaged, at €784,490
Industrial SMEs also reported the highest GVA per person engaged in their size class, at €101,232
In Construction, average GVA per person engaged in Large firms was €92,867 and for SMEs €54,688
The difference between GVA reported by Large firms and those classified as SMEs is smallest in the Distribution sector, where Large enterprises reported GVA per person engaged of €46,201 and SMEs €59,075
In the Services sector, average GVA per person engaged by large firms reached €139,692 compared to €72,558 for SMEs in 2015

	Irish-owned	All enterprises
Micro (<10)	51.2	43.9
Small (10-49)	71.1	61.2
Medium (50-249)	69.8	58.1
Large (250+)	55	15.9
	0	0
All size classes	59.1	29.9

In 2015, personnel costs represented 29.9% of GVA across all enterprises. For Irish-owned enterprises the figure was 59.1%
Personnel costs as a proportion of GVA for Large Irish-owned enterprises was 55%
When large foreign enterprises were included the value of personnel costs for all large enterprises fell to 15.9%

	SMES (<250)	Large (250+)
All sectors	56.6	16
Industry	43.1	8
Construction	59.9	26
Distribution	58.5	64.8
Services	51.2	33.3

In all sectors except Distribution, it was shown that personnel costs as a percentage of GVA was lower in Large enterprises than in Small and Medium Enterprises in 2015
Large Industrial enterprises paid 8% of GVA in personnel costs compared to 43.1% for Industrial SMEs
Services enterprises that employed more than 250 people incurred personnel costs equivalent to a third of GVA compared to approximately half of all GVA for SMEs in 2015

	Irish -owned	All enterprises
Micro (<10)	11.6	12.3
Small (10-49)	7.7	9
Medium (50-249)	7.7	9.3
Large (250+)	9.9	28
	0	0
All size classes	9.5	19.6

For all enterprises in the Irish non-financial business economy, 19.6% of Turnover was reported as Gross Operating Surplus
Irish-owned enterprises reported 9.5% of Turnover as Gross Operating Surplus
The highest rate of Gross Operating Surplus as a percentage of Turnover at 28% was reported by all Large enterprises combined

	SMEs (<250)	Large (250+)
All sectors	10.4	28
Industry	16.7	38.7
Construction	16.3	26.6
Distribution	6	6.3
Services	12.2	12.1

Large enterprises generated a Gross Operating Surplus as a percentage of Turnover of 28% in 2015 compared to SMEs who generated 10.4%
The Distribution sector generated the least Gross Operating Surplus as a percentage of Turnover, with Large enterprises at 6.3% and SMEs at 6% in 2015
The Industry sector generated the most Gross Operating Surplus as a percentage of Turnover, with Large enterprises at 38.7% and SMEs at 16.7% in 2015

	Top 50 by employment	Top 50 by GVA
Gross operating surplus	50.4	59.5
GVA	37.2	54.6
Turnover	27.6	36.4

Industry stands out in terms of its reliance on a small number of high value added enterprises. The 50 largest enterprises in Industry by GVA accounted for 68.6% of total Turnover, 85.9% of total GVA and 94% of Gross Operating Surplus for the sector
The 50 largest enterprises in the business economy by GVA accounted for 36.4% of total Turnover, 54.6% of total GVA and 59.5% of Gross Operating Surplus. These Top 50 enterprises only accounted for 6.4% of all persons engaged
The 50 largest enterprises in the business economy by employment accounted for 27.6% of total Turnover, 37.2% of total GVA and 50.4% of Gross Operating Surplus

4.1 Contribution of 50 largest enterprises by GVA within sector, 2015

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Table 4.1 Contribution of 50 largest enterprises by GVA within sector, 2015

		Industry	Construction	Distribution	Services ¹	Total Business Economy ¹
	Unit
Business Economy
Turnover	€m	233,804	15,358	148,135	203,829	601,126
Gross value added	€m	93,116	6,176	19,214	61,894	180,400
Gross operating surplus	€m	81,455	2,669	7,694	34,554	126,372
Persons engaged	No.	221,797	108,720	345,911	691,772	1,368,200
Contribution of Top 50 Enterprises
Turnover	%	68.6%	18.9%	29.9%	41.3%	36.4%
Gross value added	%	85.9%	18.4%	33.6%	43.3%	54.6%
Gross operating surplus	%	94.0%	22.4%	45.3%	42.7%	59.5%
Persons engaged	%	20.5%	8.1%	16.9%	5.9%	6.4%
Source: CSO structural business surveys
1 Excludes Financial & Insurance activities.

Business In Ireland 2015

Business Performance in Ireland

Business Performance in Ireland

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