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There's no riddle to Dell's Limerick move

Ireland picks up the pieces, counts the cost

Mark Hurd revitalised HP which ramped up its PC business and succeeded Dell as the number one shipper. That was one thing that cramped Dell's business. The second was Vista, Microsoft's dreadfully mis-executed upgrade to XP which required more PC resources - the traditional Microsoft O/S upgrade disadvantage - without offering enough performance and functionality improvements.

Vista is a dog and Apple's Leopard OS is reaping the benefits while Dell charges a fatuous $150 to downgrade Vista PCs to XP. Oh Microsoft, just how stupid is that?

The rise of netbooks has placed a floor under notebook demand, and the total EU demand for Dell computers now only needs one plant, and the one in Poland is it. When Irish workers benefitted from Ireland being a lower-cost place to put plants than the UK or France or Germany, they sipped their Guinness with relish. Now that Poland is doing to Ireland what Ireland did to other western European countries, they are crying into their beer. It's just how it goes.

A numbers game

The IDA is reported to be looking at whether Dell should repay any of the grants it has had over the past few years, nothwithstanding Dell saying it has fulfilled all its obligations in that area. But this is likely to be IDA bluster; you don't try and negotiate with a company to keep R&D and supervisory jobs in Ireland and bring new R&D work in while simultaneously clawing back previous grants - like, just how badly do you want these new jobs?

A dawning realisation in Ireland is that it will have to expand university and technical college education. If it's a white collar future and not an assembly-line one, then that means the current generation of semi-skilled workers have had it. There's more of them than the country currently needs and they'll have to do the best they can whilst the country educates their children for the hi-tech R&D jobs.

These jobs will come in dribs and drabs, 20 here, 40 there, not in thousand-plus lumps. The IDA has got to attract many more firms to Ireland. For every Dell with almost 2,000 workers the IDA will need to attract, say, 50 businesses to provide the same number of jobs, and the Irish education system will have to provide 2000 graduates in the right disciplines to gain the jobs.

There's safety in these numbers though, because individual firm moves out of Ireland won't be as damaging as the Dell Limerick assembly plant shutdown.

The numbers are inescapable, the Dell move inevitable, and an Irish future involving semi-skilled assembly line work just isn't viable. It will be a shock and the government will have to be pragmatic, move with the times, and do what it can for the semi-skilled whose job prospect future is diminishing and look to a degree-led employment future. ®

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