Cautious outlook for many Irish firms as pace of growth slackens off
Irish companies are reporting a slight slackening off in the pace of growth, and most say they aren’t seeing evidence of overheating in their own environment.
Pay is on the rise across the economy, with increases of 2pc seen as the norm for 2018, but very few firms are seeing either no rise or increases above 5pc.
Irish companies continued to post solid gains in business volumes in recent months, but the pace of growth does appear to have eased, according to the findings of the KBC Bank/Chartered Accountants Ireland business sentiment survey autumn 2017.
Hiring remains strong, an indicator that company level confidence in economic outlook continues to improve.
Despite the high media profile and its dominance of the political agenda, Brexit remains something of an enigma for Irish business. Expectations are for the UK’s exit from the European Union to be predominantly negative and slightly greater than first envisaged, but half of firms say its not something they are focused on.
One in two do still expect the effect to be harmful, compared to one in six businesses who expect to benefit from Brexit.
While Brexit is seen as a risk, the slight easing in business sentiment this autumn was largely driven by modestly slower growth in companies’ own activity levels in the past three months.
Most firms are reporting increased business volumes.
But there was a small reduction in the proportion of companies reporting higher activity and a similar rise in the number reporting lower output levels, particularly among construction firms, in a hint that some firms in this area may already be experiencing capacity strains.
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