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Bosses see austerity as main threat to recovery

IRISH business leaders are unsure whether the Irish economy has finally turned the corner almost five years after the Celtic Tiger came to an end, with almost half saying they do not intend hiring any staff at their Irish operations in 2013, according to the Sunday Independent Business Leaders Poll.

The chief executives concerned see the main threats to recovery coming not from international market turbulence, but from continued domestic austerity and lack of credit. Yet despite this, more than two-thirds believe that their company will make a profit during 2013.

The poll, which was carried out in late March, found that Ireland's top business leaders are split evenly over the question of whether or not the Irish economy has turned the corner.

Thirty-six per cent of those polled said that they did not believe that the Irish economy has turned the corner despite the fact that the country saw modest growth in 2012 when compared to the rest of the Eurozone. Thirty-four per cent were more optimistic, saying that the Irish economy has finally turned the corner, while 30 per cent were still unsure.

When asked what they believed was the biggest risk to Ireland's economic recovery, 42 per cent said that the biggest threat was the Government's programme of domestic austerity, with 25 per cent saying that despite the country's banks saying that they are open for business, the biggest issue facing the economy was lack of credit for businesses.

As a result of this divided opinion, 47 per cent said that they would not be willing to increase the number of employees at their Irish operations this year. This is bad news for Ireland's unemployment rate, which was described as "staggering" by the IMF in a report last week, which estimated that "broad unemployment", which also takes into account those who are working less hours than they want to, at a whopping 23 per cent.

Just 41 per cent of top business leaders said that they intend to hire more staff, with 12 per cent unsure if they would be able to create more jobs.

Despite this negativity, a vast majority of the chief executives said that they expected to make a profit this year. Just over one in four, 26 per cent said that they expected profits to increase, while 42 per cent said that they expected to see flat profits. Just over one in five said they expected to make a profit, but less than last year. Slightly more than one in 10 said that they would be in the red by the end of 2013, the poll found.

Irish Independent