The job losses in First Active are terrible news and I am so sorry for the many families that will be dealing with this and the great worry that follows. They are also very significant for Ireland inc. The two main
foundations for job creation in Ireland were the banks and the builders. While we have spent a lot of time debating the financial status of banks less focus has been on the employment implications for the financial
services industry.
There are 3 important implications for the banking industry from the liquidity crisis. Firstly, there will be fewer banks. Secondly, there will be a large reduction in the number if hedge funds. Finally, banking profit
margins will fall dramatically.
All of this will mean fewer jobs in the banking and financial services industry. One economist has predicted a. ‘bloodbath’ in the IFSC. While I hate language like that, there is no doubt that we must face up the reality
of a greatly changed banking sector with fewer jobs in it.
We must tackle this. Inaction simply is not a choice. Fine Gael has called on the Government to waive PRSI payments in 2009 for companies taking on new employees, declare war on red tape, launch an immediate review of overpriced electricity and gas charges, and impose a freeze on local authority charges and Government levies. All of this will have a positive effect on the general economy. However a specific plan must be drawn up for jobs in the banking sector, their protection and feasible targets for additional jobs. Bashing the banks just ignores how many they employ.