The Government will have to address the infrastructural deficit in Gaeltacht areas for employment to grow in peripheral regions, according to Údarás na Gaeltachta.

The Gaeltacht industrial development agency reported a net loss of almost 160 jobs last year in its annual review, published yesterday. Whereas 1,120 jobs were created, this was offset by a loss of 1,280 jobs during the same period.

The agency attributes this to "major development issues", both national and local. Full-time employment in its client firms stands at almost 8,100 - a plateau reached four years ago.

Grant cost per job last year was €14,701 (£11,578), it said, while the average cost per job in the same period was €12,591. Part-time and seasonal employment rose to 4,234 jobs by the end of last year, compared with 4,054 jobs in 2000. A study conducted for the Údarás last year demonstrated that "a range of infrastructural constraints" was impeding its job creation efforts, the agency said. Údarás identifies continuity, sufficiency and quality of electricity supply as a problem, and as an obstacle to further development in Donegal, Mayo and Galway.

The job losses last year - described as a loss of less than 2 per cent in the total employment base - were in the engineering and electronics sector. Some 476 jobs were lost in these sectors, but they also showed the highest rates of job creation - at 295 new posts in total.