Economic reboot after Covid-19 is possible for Ireland

As a society Ireland needs to agree how to reboot the nation’s economy on an unprecedented scale once the Covid-19 crisis ends, says Ibec CEO Danny McCoy.

While Ireland is still in the grips of the Covid-19 crisis and grimly preparing for an inevitable surge in cases, other minds are looking to the horizon and the task of rebuilding the economy once the crisis ends, because it surely will end.

One of the outspoken voices of reason on how Ireland should respond to the crisis has been Ibec CEO Danny McCoy who last week called for a €4bn fund to replace wages of up to 500,000 workers and their households, if needed, that could be affected by the economic fallout of the Covid-19 outbreak.

“We retain our innovation, our intellectual property and our educated and dedicated workforce”

Within days the Irish Government announced an Irish income fund of €3.7bn over 12 weeks, guaranteeing up to 70pc of salaries for workers retained by struggling businesses.

Shock to the economy

“What has happened in the wake of necessary measures to deal with the public health crisis is clearly a huge shock to the economy,” wrote Ibec CEO in an op-ed in The Irish Times today (26 March 2020).

“While this has been catastrophic in the short term, we must now ensure that the long-term narrative defines this period as a V-shaped phenomenon rather than a more extended recession.

“When we emerge, while our behaviour may change, our economy remains robust, so that it is capable of defrosting and rebooting at an unprecedented scale. We retain our innovation, our intellectual property and our educated and dedicated workforce.”

First and foremost in the present time McCoy said that Ireland must maintain and enforce social-distancing measures; deliver on the emergency wage subsidy and welfare payments for those who lost livelihoods literally overnight; do everything possible to preserve vulnerable businesses; and “plan an economic reboot on an unprecedented scale.”

On the Ibec website McCoy warned that a serious issue is the emergence of a potential disincentive to work arising from the higher-level pandemic welfare payment of €350 per week.

“This is of course an unintended consequence of the swift introduction of measures but nonetheless will need to be urgently addressed before it impacts the workforce of key sectors. Many of our members are reporting a negative impact from this payment and foresee a major difficulty if not addressed in legislative debate tomorrow or revised guidance and application processes for the scheme.”

He said that the impact of the Irish Government’s wage subsidy has, however, been enormous as impacted businesses endeavour to support vulnerable workers until we emerge from this crisis.

“The complexity of how business operates and the diverse nature of employment contracts means that each case must be considered individually as we unpick the measures and asses how business can apply them to their set of circumstances.”

In his op-ed in The Irish Times, McCoy emphasised the importance of enabling those who can work from home to do so while also allowing those who must go about essential business to do so. He pointed out that in Italy there are swathes of industries that continue to be productive.

What needs to happen next is social dialogue between the Government and key stakeholders in society to collaborate to address major challenges.

“While we now wrap ourselves around the flag in the national interest, we still don’t have a structure for stakeholder dialogue to withstand the crisis and bring us into recovery,” McCoy wrote.

Written by John Kennedy (

Published: 26 March, 2020