Irish medtech firms say skills shortage is a major concern

Survey by Ibec's Irish Medtech shows medical devices and tech firms also worry about labour costs, housing, and staff retention

Alcon Ireland manufacturing plant manager and recently-appointed chair of Irish Medtech Jackie Murphy with Irish Medtech director Eoghan Ó Faoláin. Picture: Arthur Ellis

Medical device and technology companies with operations in Ireland have raised concerns about a skills shortage in the country with 80% citing it as a major barrier, with labour costs and housing also being noted as pressing challenges, a new report has found.

According to the latest medtech sector manufacturing report conducted by Irish Medtech, business sentiment among medical technology firms remains polarised due to weaker global growth forecasts and trade uncertainties.

Along with pharmaceuticals, medical device manufacturing is one of Ireland’s biggest export sectors.

Labour costs, housing, and retention

The report Irish Medtech contained the results of an industry survey which found that four in five companies say skill shortages remain a major barrier with access to talent a core concern. Of the companies surveyed, 72% cited labour costs as a pressing challenge, 67% said housing, while 63% named workforce retention.

Irish Medtech is a part of the business group Ibec focusing specifically on the medical technology sector.

Improving profitability was the number one priority this year for firms operating in the sector, followed by business expansion in Ireland, and increasing production.

“Business-related costs and investments are expected to increase for large proportions of medtech businesses, while productivity and sales increases are expected at similar or lower levels than this time last year,” the report said.

Trade uncertainties 

It said the survey results indicate a “mixed sentiment within the medtech sector, with concerns over weaker global growth and trade uncertainties influencing business strategies”.

“Companies are prioritising expansion into new markets and leveraging AI to enhance efficiency and productivity.”

The report also found that two-thirds of those surveyed are planning to introduce or enhance AI (artificial intelligence) initiatives in the next few years. 

Over half, 54%, of firms surveyed cited AI as a priority for them.

Jackie Murphy, chair of Irish Medtech and manufacturing plant manager at medical device company Alcon, said the EU’s landmark €200bn InvestAI fund, with €20bn earmarked for AI gigafactories, presents a “unique opportunity for Ireland to lead in digital manufacturing”.

She said: “The Irish AI Advisory Council has already urged the Government to establish a real-time AI observatory to track AI adoption, skills development, and market trends — aligning with Irish Medtech’s call for a national strategy to accelerate digital integration across all manufacturing tiers”.

Nine of top 10 medtech firms operate in Ireland

According to Irish Medtech, around 450 companies operate in the medical devices sector in Ireland, including nine of the world’s 10 largest companies in this space. The industry employs more than 48,000 people.

Irish Medtech said the number of jobs in this sector is expected to grow to 56,000 by 2028.

With this in mind, Irish Medtech senior executive Adrienne McDonnell said “the time to act is now” given “Ireland’s ability to compete on a global scale depends on its commitment to supporting innovation at all levels of industry — especially for smaller businesses navigating the complex digital landscape”.

Irish Medtech priorities for Government 

Irish Medtech is calling on the Government to expand funding for small- and medium-sized business-led digital transformation initiatives. They also want the Government to prioritise AI and automation in the National Life Sciences Strategy; enhance infrastructure to support the technology; and create support for workforce reskilling and apprenticeships.

“Ireland’s medtech industry remains a vital economic driver, with projected revenues reaching $1.5bn (€1.78bn) by 2025 and an anticipated annual growth rate of 4.08%, propelling the market to $1.76bn by 2029,” Ms Murphy said.