Tuesday 21 January 2020

Business confidence at 6-year high as construction picks up

The troubled construction industry saw the strongest improvement in activity between July and September
The troubled construction industry saw the strongest improvement in activity between July and September

Sarah McCabe

BUSINESS conditions brightened between July and September with activity reaching its highest level in six years, according to new research. Business sentiment is now close to 2007 levels, after dissatisfaction peaked in Spring 2009.

The troubled construction industry saw the strongest improvement in activity during the period. "Clearly, this is coming from a very weak base and the turn in this sector remains tentative," warned Chartered Accountants chief executive Pat Costello. "But it is hinting at healthier domestic economic conditions in the coming year."

However, the survey, from Chartered Accountants and KBC Ireland, showed that businesses have yet to see a marked increase in employment numbers.

"Recruitment plans are still significantly influenced by the difficulties of recent years," said KBC Ireland chief economist Austin Hughes. "Employment is 'lagging' the improvement in the business environment."

Other research also released yesterday showed that businesses have become more dissatisfied with the Government's performance, with the handling of the banking crisis driving the heightened anger.

Ratings of more than 1,100 small and medium enterprises, compiled by lobby group ISME, showed that the Government's handling of the banking crisis has angered firms the most.

ISME chief Mark Fielding said this was driven by the "cavalier" attitude shown by bankers before the Oireachtas Finance Committee and the "utter disdain" displayed by the bailed-out banks to the economy.

And the body warned that more must be done to tackle high business costs.

"All costs including public sector and legacy business costs must be benchmarked against our immediate international competitors," he said.

"We must also expose sheltered sectors to greater competition and ensure greater access to bank credit for SME business."

The overall satisfaction rating with government among small businesses has fallen to –42 from –38, while micro-enterprises, at –50, are the least satisfied and the hospitality sector has dropped even further at –75.

The satisfaction on the jobs initiative is the only area to show improvement, rising fractionally from –44 to –43.

The banking score, having stayed static for two quarters, has deteriorated to –76, the worst rating since the start of the survey.

Irish Independent

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