The results of an all-Ireland
business survey shows that while competiveness has improved, global cost
pressures are making a difficult trading environment even tougher. 50% of
businesses have witnessed an increase in supplier costs compared with 12 months
ago. The survey also shows that the economic recovery amongst exporters is
likely to be jobless.
The poll of more than 1,000 cross-border business managers, shows that
69% of businesses have seen an increase in energy costs, with 59% experiencing
an increase in transport costs and 57% experiencing an increase in rates and
taxes. Similarly, 49% have seen an increase in the cost of insurance and
professional fees. In summary, 82% of business North and South do not expect any
decrease in the cost of doing business over the next 12 months.
On the positive side, businesses located in the South are shopping around with
37% of businesses having switched electricity supplier. The research, which was
undertaken by Perceptive Insight and Oxford Economics on behalf of
InterTradeIreland over October to December, also indicates that while export
companies are increasing revenues (28%), that this is not resulting in job
creation, with only 7% increasing employment pointing to a jobless recovery.
On the export side, companies are twice as likely to have increased sales as
those focused on the domestic market and 44% are expecting an increase in sales
over the next 12 months.
InterTradeIreland was established under the terms of the 1998 Belfast
Agreement, as the all-island Trade & Business Development Body,
with the remit to "exchange information and co-ordinate work on
trade, business development and related matters, in areas where
the two administrations specifically agree it would be in their
mutual interest." It is the only organisation which supports SMEs across the island to
develop North/South trade and business development opportunities for the mutual
benefit of both economies.
Commenting on the findings of the report, Aidan Gough, director of Strategy and
Policy at InterTradeIreland said, “Improvements in cost competitiveness are in
danger of being jeopardized as companies are indicating that they are
experiencing rising costs from many of their suppliers, coupled with rising
energy and transportation costs. The imperative is to ensure that Ireland
remains competitive especially where we have control over costs in relation to
rates and taxes.
While exports will drive economic growth, it is equally disappointing to learn
that this recovery is likely to be jobless, with exporters experiencing revenue
growth but unlikely to increase employee numbers over the medium term. There is
considerably better prospects for those companies that are exporting which
points further to the need, more than ever, for increased trade between North
The period under review has clearly been a challenging one for businesses across
Ireland and has been one of the least optimistic that we have seen since we
commenced reviewing sentiment amongst businesses across Ireland. However, this
may reflect the adverse weather and the arrival of the IMF in November.”