Irish Medtech Manufacturing Report Highlights Need for Investment in Advanced Manufacturing and Digital Adoption

Irish Medtech, the Ibec group representing the medical technology sector, has released its latest Manufacturing Report, emphasising the urgent need for greater investment in advanced manufacturing and digital technologies.

As the global economy faces increasing uncertainty, Ireland’s medtech sector - one of the most innovative and globally connected in the world - must prioritise digitisation to maintain its competitive edge.

With 293,000 people employed in Ireland’s manufacturing sector (Eurostat, February 2025), manufacturing remains a cornerstone of the Irish economy. However, despite its success, small and medium-sized enterprises (SMEs) in medtech require additional support to fully embrace digital transformation and AI-driven efficiencies.

Newly appointed Irish Medtech Chair, Jackie Murphy, VP, Manufacturing Plant Manager, Alcon, commented, “The European Union’s landmark €200 billion ($208bn) InvestAI fund, with €20 billion earmarked for AI gigafactories, presents a unique opportunity for Ireland to lead in digital manufacturing. 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”.

Key findings from the Medtech Industry Survey

• Business sentiment remains polarised, with weaker global growth forecast and trade uncertainties driving companies to focus on expansion (33%) and new markets (17%) in 2025.
• Labour costs (72%), housing (67%), and workforce retention (63%) remain the most pressing challenges, highlighting the need for policies that support skills development.
• AI adoption in manufacturing (54%) is higher than the national average (39%), but further incentives are needed to ensure SMEs can scale digital solutions.
• Two thirds of respondents are planning to introduce or enhance AI initiatives in the next 1-2 years. For the most part, these will be new initiatives and driven by a desire for improved efficiencies.
• Skills shortages remain a major barrier, with 80% of companies citing access to talent as a core policy concern.

A Call for Greater Investment in Advanced Manufacturing

With Ireland exporting over €16 billion in medtech products and a leader in global stent (80%) and orthopaedic knee (75%) production, there is a clear economic case for investing in advanced manufacturing. However, the ability of smaller firms to adopt AI, automation, and digitization remains a business imperative.

Irish Medtech is calling on the Government to:

• Expand funding for SME-led digital transformation initiatives.
• Prioritise AI and automation in the National Life Sciences Strategy.
• Create tailored supports for workforce reskilling and apprenticeships.
• Enhance Ireland’s infrastructure to support AI-driven manufacturing.

As the European Commission’s Competitiveness Compass and Mario Draghi's report on the future of European Competitiveness have highlighted, coordinated industrial policy and long-term investment are essential to keeping pace with global rivals such as the U.S. and China.

“Ireland’s manufacturing sector is at a crossroads,” said Mike Farrell, Chair of Ibec’s Medtech & Engineering Advanced Manufacturing Working Group, and Director of Business Transformation, West Contract Manufacturing. “We must act now to support all medtech firms, especially SME’s, in their digital transformation journey. By investing in AI, automation, and skills, we can solidify Ireland’s position as a leader in advanced manufacturing.”

Adrienne McDonnell, Senior Executive with Irish Medtech concluded “With growth forecasted to 56,000 medtech jobs by 2028, the time to act is now. 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.”

About Irish Medtech

Irish Medtech, a business sector within Ibec, represents Ireland’s medical technology sector. Ireland is one of the top five global medtech hubs, competing with the likes of Massachusetts, Minnesota and California in the USA. Ireland’s success is over a century in the making, with the sector now spanning 450 companies, including 9 of the world’s top 10 medtech companies with exports of €16 billion. The industry employs more than 48,000 people and is a global hub for medical device innovation, manufacturing, R&D and shared services.