OVER 15,000 JOBS SAVED THROUGH EXAMINERSHIP IN LAST 9 YEARS
Baker Tilly Examinership Index Shows that 501 Jobs were saved in 2018
31st January 2019: Baker Tilly has today announced that 330 companies applied for the appointment of an Examiner and 15,284 jobs have been saved through the examinership corporate recovery mechanism in the nine years since the establishment of the Baker Tilly Examinership Index in 2010. The findings also show that 501 jobs were saved by the process in 2018 in both SMEs and non-SMEs. 12 examinerships concluded throughout the year with 9 being successful.
Based on research undertaken by Baker Tilly, employees of companies which successfully emerged from the process in 2018 had an average gross wage of €532 per week and average length of service of 7.62 years. Given the 501 employees being retained in employment for cases which concluded in 2018 and the research undertaken, the savings to the State for the year as a whole is therefore in excess of €4.3million of redundancy costs. Since 2010, some 15,284 jobs have been retained through the process, generating savings to the State considered to be in excess of €132 million in respect of redundancy alone, before the costs of minimum notice payments, arrears of wages claims and ongoing social welfare costs.
While the figures do show a drop in the use of the examinership mechanism in the past year the trends do show that there is a growing take up by owner manager companies and companies experiencing family shareholder disputes.
Neil Hughes, Managing Partner at Baker Tilly, welcomed the positive employment impacts of the examinership process since 2010 and pointed out that the high number of jobs saved proves how effective a mechanism it can be for businesses right across the country.
“The jobs saved through the examinership corporate recovery mechanism has to be welcomed and in a period of uncertainty with Brexit on the horizon it’s encouraging for companies to know that there is a support mechanism if they find themselves in financial difficulties.”
“Although Ireland has witnessed a prolonged phase of strong growth that has fuelled increases in employment and consumer spending, the economy has been heavily dependent on large scale investments by multinational companies in their Irish operations. In comparison, the domestic economy has struggled somewhat to match the investment and productivity gains made by the FDI sector which has only increased pressure on indigenous firms who compete in the global marketplace. The figures released today reflect this trend with many small businesses turning to the examinership process to help regain their competitive positioning.”
“As we look to the year ahead, while more finance is available to companies experiencing difficulties, a significant uptake in the examiner process is expected. Current political uncertainty surrounding Brexit has resulted in many businesses implementing costly contingency plans that will reduce their operating margins. This may disproportionately impact firms in the agri-food sector who are heavily dependent on the UK as an export partner. Brexit uncertainty is also being compounded by a slowdown in the global economy. Lower projected growth in China and the US together with growing concerns regarding the state of the Eurozone area may reduce the opportunities for Irish firms looking to reduce their dependence on the UK market. Should Irish firms face an adverse external environment in the months ahead, it is comforting to know that a fall-back option exists to protect key elements of the Irish business community.”
More information about the Baker Tilly Examinership Index is available at www.bakertilly.ie.
About Baker Tilly
Baker Tilly is a multidisciplinary firm of trusted business advisors with offices in Dublin and Enniscorthy offering a full suite of services including corporate recovery and examinership services and having acted in the majority of examinership cases in Ireland in recent years.