2019 Review & 2020 Outlook

Posted December 9, 2019 in Zenco News

As a busy 2019 draws to a close for all those in Engineering and High-Tech Construction in Ireland, Zenco Technical takes a look at the highlights from last year and looks forward to an exciting 2020.

Highlights from 2019

The Labour Marketing Tightens Further

As figure 1 illustrates, the growth in employment in the Engineering and Construction industry has continued to stall as we approach full employment in the sector. The demand for talent has caused salaries to rise across the board as employers compete for staff in an ever-shrinking pool.

Salary Trends in 2019

With unemployment at an all-time low and the surge in construction projects across Commercial, Residential, Data Centre & Pharmaceutical Projects at an all time high, more people than ever are working in Ireland. Not only are the majority of Engineers in Ireland in steady, full time employment, we are seeing more than ever that qualified & experienced candidates have more choice around roles, sectors and companies.

Similar to the years that preceded it, the construction and engineering market as a whole continued to expand in 2019 and with numerous tenders for large scale projects currently in play,  we expect to see this growth continue into 2020. This growth has shown an increased demand for Engineers across both Electrical & Mechanical Disciplines across both Design & Project Engineering roles. Even with Brexit looming, construction companies remain optimistic for the months ahead.

This elevated activity has given way to a steady rise in salaries for the majority of roles within the construction and engineering industries.

A recent survey of Engineering Salaries in Ireland indicated that overall experience is still the primary factor when it comes to rate of pay followed closely by education and additional qualifications.

2019 Average Salaries by experience

Taking into consideration the salary levels for Qualified Engineers with the equivalent experience throughout the past 5 years, there has been a significant growth since 2014. Graduates have seen the biggest increment in base figures with a staggering 21% increase in the last number of years.

2019 Median Salaries – 5-year Trend

Irish M&E Firms Thriving in Europe

Demand for high-tech construction expertise continues to grow in the Netherlands and the Benelux region generally. This is being driven by major data centre and pharma projects for global players, including Google, Microsoft, Johnson & Johnson and Pfizer. Other growth areas for high-tech construction include bio-energy plants, chemical plants, and production facilities for the food and beverage industry.

If that sounds familiar, it’s because it mirrors almost exactly what has been happening in Ireland over the past decade and more and this has given. Irish construction companies a distinct advantage.

The quality and expertise of the Irish construction industry is now sought after internationally and the industry’s expertise in Mechanical and Electrical contracting, Civil Engineering contracting, and data centre construction is especially recognised globally. 

In Denmark alone, according to figures from the Enterprise Ireland, exports to climbed 45 per cent to €370 million last year as companies look beyond Britain and at new markets. Irish companies are performing particularly well in the area of high-tech construction with over 20 currently working on datacentre projects in Denmark.

Continued Growth of the Data Centre Sector in Ireland 

The figures are truly astonishing and show the transformative nature of the growth of big data. It is estimated that 90% of the world’s data was created in just the last two years alone. In Ireland, by 2026 as much as 15% of all electricity demand here will come from data centres.

According to the latest industry report from Host in Ireland, in conjunction with Bitpower, Ireland will gain €4.5bn worth of inward investment from the construction of data centres by 2025. It noted that €1bn worth of centres are currently under construction, while an additional €3.5bn will come from centres with planning permission that are expected to be completed in the next few years.

Annual investment in data centres has reached €1.3bn and cumulative investment in the data centre sector up to 2023 is in excess of €11bn.

There are 53 operational data centres in Ireland, which have capacity of 622MW. With eight more under construction and 26 with planning approval, the data centres in the pipeline would more than double Ireland’s capacity by 2025.

The largest concentration of data centres in the country continues to be in south-west Dublin, which is home to 14 active data centres.

Update on some of Ireland’s Major High-Tech Construction Projects:

1.Intel FAB Facility $4bn

Latest Update, 25th November 2019: Intel has welcomed a decision to grant planning permission for its proposed new $4 billion (€3.63 billion) manufacturing fabrication facility at its Leixlip plant and said that preliminary work on the project is already underway. Granting of planning permission comes three years after Intel secured permission for the first phase of the ‘fab’ facility valued at $4 billion.

In total, the two planning permissions represent a $8 billion (€7.26 billion) investment which will employ 6,000 construction workers at peak and 1,600 full time jobs on completion.

The projects represent the largest single private investment in the history of the State on one project if given the go-ahead by Intel globally.

2. WuXi Biologics, $240 million new vaccine manufacturing facility in Dundalk

Latest Update: The $240 million investment to build a new vaccine manufacturing facility in by WuXi, a global open-access biologics technology platform company, continues to progress at pace. Offering end-to-end solutions for biologics discovery, development, and manufacturing, the company’s subsidiary WuXi Vaccines, which is engaged in human vaccine contract development and manufacturing organization (CDMO) business, signed a 20-year manufacturing Letter of Intent (LOI) earlier this year.

Under the LOI, this new dedicated vaccine manufacturing facility, including drug substance manufacturing (MFG15), drug product manufacturing (DP5) as well as Quality Control labs (QC), will supply a vaccine product of a large global pharma for the global market. The new vaccine manufacturing facility, subject to planning approval, will be located within the WuXi Biologics Campus adjacent to the “Factory of the Future” biologics drug substance manufacturing facility which is scheduled for commercial manufacturing in 2021.

The investment is creating 200 highly-skilled jobs in WuXi Vaccines, which is in addition to the 400 roles announced last year by WuXi Biologics for Dundalk.

3.The New National Children’s Hospital €1.43 billion.

Latest Update, 27th of November: During the latest Oireachtas committee on health on Wednesday, we heard that construction of the new national children’s hospital is behind where it should be as its development board chairman Fred Barry has said that one critical milestone – the removal of a road running through the site – had been missed.

However, he said the building programme still had three years to run, to the end of 2022, and he hoped time could be made up.