Rural SMEs struggle to compete with remote-working city salaries 

Large employers are buying up homes to ensure their employees have somewhere to stay, an Oireachtas committee heard

Housing is now the second most important consideration for employees behind a salary or wage offer.

Business associations have warned that Irish SMEs trying to attract talent in rural areas are struggling to compete with multinational corporations, who are paying city base salaries for employees to work remotely.

Speaking before an Oireachtas committee on enterprise, trade and employment on Wednesday, Chambers Ireland chief executive Ian Talbot said that the greatest challenge facing small and medium enterprises this year is “the lack of available talent which is driven by affordable and appropriate housing being unavailable across most of the country”.

“With a small number of exceptions, all our chambers have housing as the main cause of their businesses’ challenges,” he said.

He said that large employers are now buying up homes to ensure their employees have somewhere to stay, noting that several times in the last year their association was contacted by large employers looking to buy out entire housing estates for their workforce, and it is “becoming ever harder for smaller and medium-sized firms to compete”.

Mr Talbot added that SMEs in more rural areas are competing with multinational corporations for skilled workers who do have accommodation locally. He said that larger employers are paying city base salaries for employees to work remotely, “which means that skill set isn’t available in that local town, or it’s only available at city prices”.

Housing a 'huge' issue

Neil McDonnell, chief executive of the Irish Small and Medium Enterprises Association, told the committee that housing is a “huge” issue for employers, with housing now the second most important consideration for employees behind a salary or wage offer.

He said that employers are currently not making more noise about the issue because many are housing their employees themselves, which “presents a significant tax and BIK issue for both employer and employee, because employers are providing the accommodation either at sub-market rent or at no rent at all”.

Simon McKeever, chief executive of the Irish Exporters Association, said that he has “serious concerns” about how the lack of housing could impact Ireland’s “whole economic model”, such as the country’s ability to attract FDI.

“If people can’t get homes or afford them, then how are these employers going to be able to attract new workers and hold on to the ones they have?

"It is something that is now absolutely critical. Business is screaming about it. And something really, really needs to be done about this or it will affect the long-term economic model that we have,” he said.