Knowledge economy is in need of bright ideas
Northern Ireland badly needs improved economic policy ideas to close the gap with other regions in the UK and Ireland. In this search, radical ideas are emerging from Catalyst Inc (formerly the Science Park) which is working on the potential contribution of growing a 'knowledge economy'.
The term 'knowledge economy' (KE) points to how better knowledge can contribute to higher value production and better living standards. It's an essential building block, and the economic policy centre in the Ulster University (UU) has been tracing the recent changes.
The UU team has concluded that Northern Ireland does have a useful and growing knowledge based economy as the UK's second fastest-growing knowledge economy. However, it not large enough, not growing fast enough and in need of support through a "rapid reboot of NI economic strategy".
Whilst the analysis from Catalyst Inc is unique and producing verifiable evidence that comes as close as possible to reliable quantification of key indicators, a critical feature is that, of the 12 UK regions, NI is in 11th place and despite recent progress has not overtaken any other region.
Businesses classified as part of the KE show earnings and productivity are well above the average for the whole NI economy. Clearly, more KE businesses should be encouraged. When the recent report on the KE moves from analysis to prescription, the argument becomes more hazardous and controversial.
As a broad ranging thesis the Catalyst Inc team sought the opinion of the UU economists on the potential for major changes in the emerging sources of employment and the risks of losing employment in sectors where jobs were being lost, particularly to increased automation.
A special analysis sign-posted evidence of an emerging employment revolution where different forms of automation were being adopted and producing higher value-added per employee while improving competitiveness. In a spectrum of results, the largest changes were identified in a study by Osborne, Frey & Downing which (if paralleled in NI) might have some impact on over 424,000 jobs here.
This study is interpreted misleadingly either if the degree of 'impact' is seen as all jobs being lost or if the degree of automation is unhelpfully described as the arrival of robotics.
Some of the reports damaged the serious lessons by introducing these confusing unmerited simplifications. The employment revolution transforming the methods and impact of the arrival of the KE may be partially influenced by both these and other technical changes in working methods.
As with the continuing history of economic progress, excessive fears of redundancies and reduced employment numbers are likely to be misunderstood, overstated and used to resist creative changes.
The direction of change in a successful KE is neither a major threat to jobs nor a reason to avoid appropriate policy changes. The Catalyst Inc team are pointing in the necessary direction of change but, unfortunately, stop short of developing to the practical operational policies that should now be commended. When the team ask for 'a rapid reboot of (NI) economic strategy to prepare for a technology-led modern economy' that calls for careful suggestions of what the reboot should do.
Equally, to suggest a dynamic coalition of Government and others to deliver practical solutions is an inadequate generalised conclusion. In a suggested massive step change in public sector spending priorities asking if "the economy and education can continue to pay for inefficient public spending" is a proposal that is too oblique.
Catalyst Inc has modestly pointed to a very critical agenda. Step one is completed … now what?
Company Report: Dunbia Ltd
Dunbia Ltd in Northern Ireland reports on the consolidated results for a large number of subsidiary companies. In turn, Dunbia is a wholly owned subsidiary of its parent company, Dunbia (IOM) registered in the Isle of Man.
The accounts for the most recent year are for a 53 week year. Although 2016-17 is a 53 week year, business turnover was affected by the change in this business as its operations in the Republic of Ireland were sold to Dawn Meats as part of a new strategic partnership with Dawn Meats in a joint venture bringing together the joint operations of Dunbia and Dawn Meats in the UK.
That strategic venture with Dawn Meats, because of its scale in the UK market, was subject to approval from the competition authorities.
Dunbia Ltd, centred on Co Tyrone, is thought to be the largest processor of meat supplies in Northern Ireland. The company was founded by Co Tyrone brothers Jim and Jack Dobson.
Two years ago, the brothers sold their pork processing operations to UK giant Cranswick plc.
A large part of the overall turnover of over £768m is through subsidiary businesses in GB.
Dunbia has several registered active subsidiary companies.
In the most recent three year period, operating and pre-tax profits have improved.
Operating profits in 2016-17 at £13.2m were just under 2% of turnover, indicating that the products were selling at quite small profit margins.
The group has delivered a significant programme of capital investment and business acquisitions in the last three years.
This was partly financed by the disposal of assets of nearly £14m.
The programme of investment and business disposals allowed the group to repay a large loan from the parent company in the Isle of Man, to the point where that loan was completely repaid at the end of 2016-17.
Even with these financial transactions, the retention of post-tax profits has seen the balance sheet value of shareholders’ funds rise from £58m two years ago to £75m on April 2, 2017.