The envy of many countries, Ireland's tech sector enters an uncertain future
Jobs Musk Nearly Expected Twitter Cut Elon 4,000 To Is
Ireland has become a holy grail for multinationals over the years, particularly those in the tech sector, due to its close proximity to the rest of Europe and its low corporation tax rate of 12.5%, one of the lowest on the continent.
However, the country is now bracing itself for the fallout of various cutbacks that companies are making due to growing economic pressures.
Twitter, Stripe, and Intel have all made stark announcements about significant job cuts recently and the full impact of these decisions for their Irish employees is still unclear.
Just over a decade ago, Twitter chose a four-storey building on Fenian Street in Dublin to be its European headquarters. Now, the future of the multinational’s presence in Ireland looks shaky.
Ireland became Twitter’s third location outside of the US and grew its workforce in the country to around 500.
In recent months though, Twitter announced it is cutting back on its physical office space in several global markets, including in Dublin. This was before the social media giant was bought by controversial businessman Elon Musk in a deal worth more than €45bn.
At the time it said no jobs will be affected by the scaling back of workspaces. The company had more than 7,500 employees at the end of 2021 and has around 30 different locations worldwide.
Now, Mr Musk is reported to have set out plans to slash Twitter’s workforce. It is still uncertain how much of an impact this decision will have on its Irish office.
Hours after Musk's indicated he'd half Twitter's staff, Stripe also announced it will cut around 1,000 jobs. The payments processing giant also did not break down where these jobs would be lost.
Stripe is one of the most successful start-ups in the world and was founded by Limerick brothers John and Patrick Collison in 2010. Their clients include Peloton, Amazon, and Google.
Earlier this year though, it was reported that Stripe lowered its internal valuation by 28%.
Before economic headwinds took their toll on the company, last year Stripe announced plans to add hundreds of new engineering jobs in Dublin over the next three years.
Meanwhile, Intel indicated it will cut thousands of jobs due to inflation and the slowdown of the personal computer market.
In recent months, Patreon, a company that helps podcasters sell their product to subscribers, announced plans to close its Dublin office and cut 17% of its overall staff.
Ireland’s relationship with tech giants has been called “risky” even before these companies decided to slim down to deal with cost pressures.
Budgetary watchdog the Irish Fiscal Advisory Council previously urged the government to be cautious when it comes to relying on corporation tax receipts.
For every €8 that is collected in tax revenue in Ireland’s economy, €1 out of that comes from tax collection from multinationals.
Although there are mounting concerns in the tech sector, there are still over 400 multinationals with a presence in Ireland, according to Tech Ireland.