Physics business brings in over €38 bn to Irish economy

17 January 2017

Physics-based industries contribute more than €38 bn annually to the Irish economy and employs over 287,000 people, according to a new report published by the Institute of Physics.

Industries dependent on physics contribute more than €38 bn to the Irish business economy, according to analysis commissioned by the Institute of Physics (IOP) and conducted by the Centre for Economic and Business Research.

The report – the most comprehensive study of the role of physics in the economic growth and productivity of Ireland – was launched on the 12 January at the Royal Dublin Society.

Those in attendance included policymakers, physicists and business leaders, including Minister of State for Training, Skills and Innovation John Halligan, who commented on the report: “Physics-based industries make crucial contributions to GDP and employment, as well as playing an important role enhancing productivity, boosting economic growth, through their R&D activities and through their contributions to exporting.”

With physics-based industries directly generating a turnover worth € 48.7 bn, equivalent to 14% of the overall turnover in Ireland’s business economy, physics is not just the source of inventions and ideas, but also a key point of the Irish economy now and in the future.

Physics and indeed physics-driven technologies underpin a wide range of industries, all of which Ireland is dependent on for its economic growth.

Across Ireland in 2014, physics-based industries represented just under 83% of all external R&D spend, with direct employment by physics-based businesses amounting to an 8.6% share of total employment in Ireland – greater than that of construction and the financial services sector.

Those employed in these industries contribute an average estimate of €138,000 a year in gross value added, markedly above both the retail and construction sectors’ average labour productivity.

Chief executive of the IOP Professor Paul Hardaker commented: “Ireland has a strong tradition in world class physics research and this report shows the value of that to Ireland’s economy, business and jobs.

“One of the reasons we wanted to launch this report at the Royal Dublin Society and also during the BT Young Scientist and Technologist event is to remind people how important it is to encourage our young people, who will be scientists and experts of the future.”

Minister Halligan also highlighted how vital physics education in schools is for ensuring the continued success of the role of physics in the Irish economy: “Many connected factors are at play if we are to ensure physics-based industries have sufficient resources. Currently a quarter of our second level schools do not offer physics at Leaving Certificate and this is something that needs to be targeted. It is crucial that interested students have access to teachers qualified to teach physics.

“While there has been a welcome rise in the numbers taking physics at third level, our third level institutes must also be given every available support to resource this.”

Noting that the report identified investment in R&D as vital to the success of physics-based industries, the Minister said approximately 15% of Science Foundation Ireland (SFI)’s current investment related to physics while, outside large scale Research Centres, SFI supports 50 active awards broadly categorised under physics, which are valued at approximately €6.3 million.

Chairperson of IOP Ireland, Dr Mark Lang, also commented: “Ireland is a strong physics nation, home to international researchers and part of world-leading collaborations.

“However for Ireland to sustain this work and continue to build its physics-based industries there needs to be strong support for basic research which inspires and underpins the applications and technologies of tomorrow.”

For further detail about the classification method and more detailed findings, please see the full report - The role of physics in supporting economic growth and national productivity in Ireland.