Fact Check: Is Ireland’s Productivity on the Rise, or Is It ‘Artificial’?

Dublin’s Liberties district hosts the expansive Guinness factory, where the iconic beer has been brewed since 1759. Although now part of the global drinks giant Diageo, the brewing process has retained its core principles. Aidan Crowe, operations director for beer at Diageo, highlights the advancements in efficiency achieved through technology, with the Dublin brewery currently producing 3.5 million pints per day.

Ireland, with its favorable economic environment for multinational corporations, has become the most productive country globally, according to the Organisation for Economic Cooperation and Development (OECD). Productivity is measured by the value a worker adds to goods or services, and Ireland’s concentration of multinational firms significantly contributes to its high productivity figures.

Dr. Emma Howard, an economist at the Technological University of Dublin, notes that Ireland’s total labor productivity is two and a half times the EU average, with significant differences between domestic and foreign sector productivity. The Central Statistics Office measures productivity using gross value added (GVA) per worker per hour, indicating that foreign firms play a substantial role in driving Ireland’s productivity. In the second quarter of the previous year, GVA for foreign firms in Ireland was €414 per worker per hour, while domestic firms recorded only €55.

Foreign firms contributed 56% to the gross value added in the Irish economy in 2022, attracting global companies like Google, Microsoft, Pfizer, and Meta. The appeal of Ireland to multinationals includes its low corporation tax rate, making it an attractive location for producing high-value goods and intellectual property. Ireland’s unique economic landscape, fueled by a concentration of multinational corporations, has positioned it as a global leader in productivity.