As trade and investment with Europe grows, Ireland has successfully combined focused economic strategies with investment in talent and innovation, making it a European base for many US and Bay Area companies. This report documents these deep connections and the opportunities that exist for even closer cooperation between Ireland and the San Francisco Bay Area.
Growth and Transformation: Economic Ties Between the San Francisco Bay Area and Ireland
Executive Summary
As trade and investment with Europe grows, Ireland has successfully combined focused economic strategies with investment in talent and innovation, making it a European base for many US and Bay Area companies. This report documents these deep connections and the opportunities that exist for even closer cooperation between Ireland and the San Francisco Bay Area.
The Irish Community in the Bay Area
The Irish presence reflects the history of Irish immigration, where together with New York, Boston, and Chicago, San Francisco has been a major destination. Since the 1800s, Irish immigrants and their descendants have played prominent roles in the Bay Area’s government, business and civic life.
Reflecting the Bay Area’s deep historical and family ties with Ireland, five cities in the region have established sister city counterparts: San Francisco with Cork, San Jose with Dublin, Menlo Park with Galway, Los Gatos with Listowel, County Kerry, and Dublin (California) with Bray, County Wicklow. A newly formed relationship is being developed between Palo Alto and Dún Laoghaire-Rathdown. In western San Francisco’s Parkside neighborhood, the United Irish Cultural Center has served for fifty years as a home for the Irish community.
University Connections
University connections add to the relationship. Key points of connection include the UC Berkeley Irish Studies Program; a collaborative program between Berkeley’s campus-affiliated SkyDeck accelerator and University College Dublin; BioInnovate Ireland, which was spun out of the Stanford Byers Center for Biodesign; and a partnership between the University of California, Davis and University College Dublin, focusing on agriculture, food and health.
The Bridge to California
Team Ireland
Ireland’s consulate in San Francisco marked the 90th anniversary of Ireland’s diplomatic presence in the Bay Area in 2023. In 2022, the Irish government’s formerly dispersed footprint in the Bay Area was consolidated in San Francisco at Ireland House, which integrates government services while serving as a platform for visiting government officials and business leaders. Agencies resident in Ireland House include the Consulate General, Enterprise Ireland, and Tourism Ireland.
Tourism
Ireland is a major destination for Americans, with the US being the top source of visitor revenue. Since 2015, the number of US visitors to the island has grown 44.2%, with approximately one-fourth originating on the West Coast, including more than 200,000 from California. Ireland’s national carrier Aer Lingus has provided direct service between San Francisco and Dublin since 2014.
Irish Investment in the US and California
Investment between Ireland and the United States is a two-way street. In 2023, 500 Irish companies had operations in the United States, employing 98,000 people at 2,269 locations across all fifty states. In 2022, Ireland was the seventh-largest overseas investor in California, ahead of China, with 480 establishments supporting an estimated 25,464 jobs and $3 billion in wages.
US and Bay Area Investment in Ireland
Considering its small size and population—only 5 million—Ireland is remarkable as a destination for investment from the United States. More than 900 US companies currently operate in Ireland, directly employing 210,000 people. Bay Area companies play a particularly strong role. Five of the ten biggest foreign direct investing companies in Ireland (LinkedIn, Meta, Intel, Apple, Alphabet/Google) are Bay Area headquartered. Between 2017 and 2022, Bay Area companies made 161 distinct investment deals in Ireland, totaling $30.6 billion. More than 85% of that investment is directed toward ICT and electronics.
Bay Area companies with major operations in Ireland include: Airbnb, Alphabet/Google. Apple, Applied Materials, Autodesk, BioMarin, Cadence, Cisco, Docusign, Dropbox, eBay, Fidelity, Fitbit, Gilead, GoFundMe, Hewlett Packard Enterprise, Indeed, Intel, LinkedIn, Meta (Facebook), Oracle, PayPal, Salesforce, Slack, Stripe, Twilio, Uber, Udemy, VMware, Wells Fargo, Workday and Zendesk. For many, Ireland serves as the company’s European headquarters.
A Growing Knowledge Economy
With a population of only 5 million, Ireland has seen its economy emerge from relative poverty to achieve strong economic growth, enabling the country to become a dynamic European technology center, that spans both tech and life science and hosts large numbers of multinational corporations (MNCs).
■ The IMD World Competitiveness Ranking 2023 places Ireland at #2 (behind #1 Denmark) out of 64 economies in the world.
■ The INSEAD 2023 Global Talent Competitiveness Index ranks Ireland #12 out of 134 economies it assesses.
■ WIPO’s Global Innovation Index 2023 ranks Ireland #22 out of 132 economies tracked.
■ The KOF Swiss Economic Institute’s 2022 Globalization Index, which evaluates 196 economies, places Ireland at #11 in its ranking.
Several factors have driven Ireland’s economic growth: economic stability, low corporate taxes, sound budget policies, deregulation, EU membership, EU subsidies, a highly educated English-speaking workforce, and close ties with the US. The Good Friday Agreement, a 1998 political settlement between the British and Irish governments and Northern Ireland’s major political parties, has provided a stable environment on the island, accelerating a shift of resources toward investment attraction and economic development.
Growth, Taxation and Education
Apart from a sharp downturn in 2008–09 during the global financial crisis, Ireland’s economy has steadily expanded and saw just under 12% annual growth in 2022. In the post-COVID period, the economy has proven resilient. GDP per capita (2022) is over $100,000.
A number of policies have supported this growth trend, particularly in taxation and education. Ireland’s attractive 12.5% corporate tax rate has been one of several factors in attracting foreign direct investment (FDI), which under agreements reached in the OECD and the EU will be harmonized in 2024 to an agreed standard minimum of 15% for large companies. While tax policy has played an important role in Ireland’s ability to attract foreign investment, Ireland’s primary competitive advantage comes from its deep talent base—a factor that is expected to counterbalance the planned global harmonization of corporate tax rates. With 33% of its population under the age of 25, Ireland is home to the youngest and most highly educated workforce in Europe. The OECD ranks Ireland’s workforce as the most productive within its membership.
Technology Clusters
Foreign investment was initially drawn to Ireland by its low costs and favorable regulatory environment, offering a strong manufacturing base for the European market. While manufacturing remains a core focus, the business model has since then moved into technology and services, with universities playing a growing role. Technology and investment in Ireland cluster in four cities: Dublin, Cork, Galway, and Limerick. The fDi Intelligence 2023 European Cities and Regions of the Future 2024 index ranks Dublin in the top three major cities in Europe for foreign direct investment, after only London and Amsterdam. The same index ranks Cork, which supports a major cluster of tech, cybersecurity and life science companies, as number two for economic potential among the top Small European Cities. Limerick ranks number two among Micro European Cities overall and Galway, with a strong focus on medtech, ranks number three.
Science and Innovation
Ireland has invested in its science infrastructure, linked to economic goals:
■ Six National RD&I Institutes provide specialized support to enterprises, with a focus on basic research.5
■ Science Foundation Ireland’s 16 research centers partner with industry and academia to support collaborative research.
■ The Enterprise Ireland and IDA Ireland joint Technology Centre Programme operates nine technology centers that support companies through market-focused R&D.
■ Sixteen centers of the Enterprise Ireland Technology Gateway Network advance targeted R&D aligned with industry needs.
Startup Ecosystem
Though smaller scale than other leading startup ecosystems, Dublin places number five in Startup Genome’s Top 100 Emerging Ecosystems 2023 ranking. The compounding effect of the presence of large multinationals supports innovation, as many employees who leave multinational companies either join local companies or launch startups. The Bay Area’s Plug and Play accelerator plans to add Ireland as its next global site. Y Combinator has invested in Irish or dual-based companies, including Stripe.
Digital Policies
Ireland’s growth has been built on manufacturing as opposed to R&D, though that pattern is changing. Government investment in R&D, which amounted to less than €250 million in 2000, now approaches €1 billion. The country’s enterprise research, development and innovation base has grown from 800 active R&D firms thirty years ago to 1,800 R&D-active enterprises today. Still, a gap persists between the innovation performance of enterprises in Ireland and other advanced economies, and between the performance of MNCs in Ireland and local firms.
Digitalization is a priority. The government launched its national strategy—Harnessing Digital: The Digital Ireland Framework—in February 2022, followed by the creation of a “Grow Digital” Fund (formally known as the Digital Transition Fund) in June 2022. AI and cybersecurity are key areas of focus. The digital strategies are finding success. The European Commission’s Digital Economy and Society Index (DESI) 2023 shows Ireland holding a leading position in the EU on several enterprise, skills, and connectivity indicators and performing above the European average in measures such as the share of residents with basic digital skills, the share of SMEs with at least a basic level of digital literacy, and the share of Gigabit-network-covered businesses and households.
Research Opportunities
Ireland offers a distinctive window for R&D. The US-Ireland Research & Development Partnership connects the United States, Ireland, and Northern Ireland through research, melding science and diplomacy. A related window comes through Science Foundation Ireland’s SFI Industry RD&I Fellowship program. To date, SFI has had 300 engagements on the West Coast with 154 partner organizations. While university research is core, 45% of SFI’s West Coast projects are non-academic.
All Island Economy
An “All-Island” economy is developing that integrates and leverages capacities on both sides of the Ireland- Northern Ireland border. That economy is supported by the Good Friday Agreement, reinforcing its peace dividend and supporting growth in the north and south. Since its signing in 1998, cross-border trade in goods more than tripled to €10.5 billion in 2022. From an external perspective, the island can be seen as a single market and business ecosystem, with all-island employment and supply chains.
Conclusion
Ireland and the Bay Area are deeply connected through immigration, history, and a shared cultural heritage which facilitates communication and the movement of people. Civic and university ties deepen the foundation.
Ireland has enjoyed economic success that belies its small size, serving as the European headquarters for a wide range of Bay Area companies in technology and life sciences. Its dynamism builds on competitive tax policies and a business-friendly environment, but most importantly on Ireland’s sustained commitment to education and the development of talent. Those strengths continue to attract investment from the Bay Area, which has an outsized presence in the Irish economy.
While Ireland’s relationship with the Bay Area is well-established, it continues to present opportunities:
■ Generous windows are available to support bilateral R&D in both industry and academia. Aggressive outreach to potential partners, particularly in industry, can help expand their reach.
■ While technology companies are well-represented as investors in Ireland, other sectors with significant potential for growth include biotech, medical technology, fintech, and the green economy.
■ There is room for deeper engagement between Ireland and the Bay Area university, science, technology, and investor community. Ireland’s recently announced placement of a Talent and Innovation Attaché in San Francisco offers an opportunity to expand those ties.
■ The all-island economy offers opportunities to leverage resources in both Northern Ireland and Ireland, drawing on human resources and industry depth on both sides of the border—in cybersecurity, for example—and strengthening access to both the EU and UK markets.
■ Growing business investment and strong flows of both tourist and business travel present a clear opportunity to expand direct air service between the Bay Area and Ireland.
■ To deepen the talent connection with the US and the Bay Area, the duration of Ireland’s visa program for foreign graduates of Irish universities in priority fields could be lengthened.
■ With strong and diverse relationships in place, there is a case for considering the activation of an Irish business association or chamber to connect new and existing business networks. This entity would link Irish business leaders and companies with a local presence, as well as US companies with interests in Ireland and Europe. While this initiative could be confined to the Bay Area, a state-level focus may also be useful, building on preparatory work that has already taken place.
■ With its strong US ties, English-speaking culture and business-friendly policies, Ireland is also well positioned as a business gateway to Europe and a bridge to the European Union in fields such as venture capital and digital regulation.