By John Spain

But it’s a different ball game I want to look at here this week. It’s a whole new ball game as well, but its significance far surpasses the guys with the posh accents kicking around that funny oval-shaped ball in Croker on Sunday.

What I’m talking about here are the fundamental changes that are happening in the jobs market in Ireland. Over the past few weeks the trend revealed by these changes has become more evident, and what it amounts to is a whole new ball game for the Irish economy. And we should be much more concerned about that than the significance of “foreign” games being played on the sacred turf.

You know what they say when you start believing your own publicity you’re really in trouble. We’ve been listening for so long to the hype about what was driving the Celtic Tiger economy that we have forgotten that it was only partly true.

The hype said that our economic boom was created and maintained by the very high proportion of talented young workers in our population, all of them highly educated and technically adept. That was why so many foreign companies including so many American multi-nationals wanted to set up shop here.

And it was at least partly true. We did have a huge young population, and they were indeed bright and sparky.

There were other factors that were also important. We offered foreign companies generous grant aid to set up here, lengthy tax holidays, the lowest company tax regime in Europe and no fuss about repatriating profits. It all made Ireland the obvious place to set up for direct access to the European Union market.

The foreign companies, particularly the big American names, flooded in. They loved the army of available young workers who were smart and who spoke English (so no language problems). Ireland was a welcoming and congenial place to set up business.

But the key thing more important than everything else was that we were a low cost location. So our economy took off, success bred success, we were on a roll and soon the Celtic Tiger was roaring. It roared away for a decade.

But there are signs now, especially in the last few weeks, that the Tiger has a very sore throat, and if we’re not very careful the animal might even die on us.

The evidence for that is the frightening rate at which we are now losing jobs as foreign companies close up shop and shift their operations elsewhere. The reason is simple we are no longer a low cost location.

Of course this has been going on for some time now. We have been losing labor intensive low skill manufacturing jobs to cheaper locations for several years.

Usually this involved traditional industries like garment manufacturing moving to countries in Eastern Europe, North Africa or the Far East. It was painful, but the belief was that this was inevitable and that our high education levels and technical skills would attract even better jobs and protect us into the future.

But recent weeks have shown that this may not be the case because the trend to get out of Ireland (or at least move large numbers of jobs out of Ireland) now involves some of the major multi-national companies who set up here, including some of the prestige names in key sectors like computers, information technology and pharmaceuticals.

Last week it was Pfizer and in the weeks before that it was Motorola, Vodafone, Thompson Scientific and several more. Hundreds of jobs are being lost every few weeks in the kind of industries that were supposed to be the basis of our future prosperity.

Sometimes the issues involved are complicated. Pfizer, for example, has cancelled production of the new anti-cholesterol drug it was banking on.

But the underlying reality is pretty simple really. Our workers are now much too expensive, and there are armies of cheap young workers in many other countries who are now well educated and technically smart.

Plus other countries have matched our tax incentives. We have been beaten at our own game.

One of my colleagues here last week was remembering that much quoted line from a New York Times report about Ireland that pointed out that an American office worker who used a Dell computer powered by an Intel chip, running Windows software and an Oracle database, and who took Prozac in the morning and Viagra at night, had all these products supplied from the Irish Republic.

My colleague also suggested that since this American consumer was clearly a man who was over-indulging, there was a good chance he was drinking lots of Coca-Cola, possibly made with concentrate from Ireland, and was probably also drinking lots of Bailey’s Irish Cream and Michael Collins Irish whiskey. And with all that hardening his arteries, he was probably taking Pfizer’s existing anti-cholesterol drug Lipitor, also made here.

Those were the days, my friend. We thought they’d never end ... but the events of the last few weeks, as one closure followed another, has made us worry about the future.

Pharmaceuticals and medical equipment and other sophisticated manufacturing sectors can now be duplicated in cheaper locations. Computer hardware is now a low-margin, high-volume business needing low wage rates. Even software development and information technology products can be handled by a new generation of workers in much cheaper countries like India.

And it’s happening with our call centers. Buy a Dell computer in Ireland and ring the customer support line and you find yourself talking to someone in a call center in India (I know because it happened to me a few weeks back).

In a nutshell, we are facing a dual problem. Firstly, the competition from other countries with smart young workers is now much stronger than before. Secondly, our costs, in particular our wage rates, are way out of line.

We can’t change the first factor. And whether we can do anything about the second in terms of wage restraint or improved productivity to offset the wage gap, remains to be seen.

The fact is that increased competition from the 10 Eastern European accession states who joined the EU recently and from cheaper economies like India and China is posing a real threat to jobs here, not just in the low level manufacturing sector but also in the more sophisticated end of the economy as well.

The National Competitive-ness Council, the official body here with responsibility for keeping us up to speed in comparison with other countries, warned in its annual report that we face a challenging future. According to the report, between 2000 and 2006 Ireland experienced a significant loss of price competitiveness.

Some of this was outside our control we are completely exposed to hikes in oil and gas prices and to the shift in the value of the euro in relation to the dollar. But our cost competitiveness is also affected by our wage levels and our productivity, both of which are within our control.

According to the council we also need to develop a more knowledge-intensive workforce. And we need to think more realistically about our energy supply (which may mean thinking nuclear) because there are serious doubts about the ability of our present energy market to provide our present power needs at reasonable prices or to cater for further economic expansion.

The main warning from the council and from various economists is that we are now far too dependent on the building boom here. This has reached the stage where the construction industry and consumer spending based on borrowing have replaced our exports as the drivers of the economy. This is unsustainable.

We have turned from an economy that used to export goods for a living into a smoke and mirrors economy where growth depends on keeping a building boom going, and allowing people to spend lots of money they don’t have on services they only think they need.

In addition, the Council report states that while our low corporation tax rate (12.5%) is still important for attracting foreign companies, competition is growing as corporation tax rates elsewhere fall in both EU and non-EU countries.

And then there are our transport, broadband and other infrastructure problems that are still there in spite of all the money that we made and wasted at the height of the Celtic Tiger boom.

We pay ourselves too much, we don’t produce enough and our economy is a hotbed of service “industries” staffed by cheap labor, including many immigrants. The manufacturing base which is supposed to support all the rest of the stuff is shrinking by the week as we price ourselves out of the global market and lose more and more multi-national company jobs to cheaper locations.

As I said at the beginning, it’s a whole new ball game.