IBEC, the group that represents Irish business, today published its latest Quarterly Economic Outlook, which said that the Irish economy will grow again this year, despite the slowdown in activity in our main trading partners, and plant and machinery investment is set to rise by 10%. The Outlook, which contains a section on the economics of the Stability Treaty, also said that there is nothing in the treaty that will require additional austerity in future years and that ratification would boost the country’s growth prospects.
IBEC Chief Economist Fergal O’Brien said: “Following a return to economic growth in 2011 for the first time in four years, the economy will grow by 1% this year. International trading conditions remain difficult, but exporters continue to benefit from competitiveness improvements and the weaker euro has helped exports to non-eurozone countries. Investment by industry in new equipment and machinery will grow again this year, reflecting the strong export performance of recent years and Ireland’s on going attractiveness to FDI investment. The jobs outlook has also improved somewhat over recent months and the export recovery has meant that job creation has exceeded job losses for the first time since 2007.
“The result of the referendum on 31 May will have a direct impact on the Irish economy. A yes vote is crucial to our future economic prospects. The treaty will provide a better set of rules for the public finances and help ensure that Ireland remains an attractive location for investment. Crucially, from a business perspective, it will make it easier for Irish corporates to raise funding in international debt markets,” said Mr O’Brien.
Brian Cleary joins Kehlan and Conn to review the news for this week’s Small Business Show. Brian is the CEO of Clonmel Chamber of Commerce, who are working hard to make sure local business view their chamber membership as “an essential tool for business”. As part of that they are running a month of free events for members in May, which they’ve renamed SME Month!
This week’s podcast discusses IBEC’s plan for economic recovery; optimism for tourism; Mumpreneurs; and Jam-making!
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At a breakfast briefing in the Aviva Stadium, Dublin, IBEC today launched its ‘Driving Ireland’s Recovery campaign: The business community’s ambition for Ireland’, and said the Irish economy has the potential to grow by 3-4% per year, over twice the EU average, over the next 20 years. To achieve this, IBEC said we need to adapt the successful economic model that delivered the sustainable, pre-property boom growth of the 1990s, and take decisive steps to address immediate economic challenges.
At the briefing IBEC Director General Danny McCoy said: “Today the business community declares its ambition to drive the recovery. Business can generate the growth needed to create jobs, overcome our debt burden and deliver the prosperity, public services, and quality of life that this country can legitimately aspire to. There is no reason why Ireland cannot be one of the EU’s most prosperous and successful regions and the best country in the world to do business.
“The focus must move from austerity and stabilisation, to growth and possibility. We have a large and educated workforce; our indigenous companies have the ability to match the productivity of the multinationals and our infrastructure is vastly improved. The property boom sucked investment and talent from other parts of the economy, we now need to redirect and reinvest these elements in a way that delivers sustainable growth.
“All of this means we have the capacity to recover faster and stronger than others. We have done it before; we can do it again. Yes there are challenges and they not insignificant, but we have created momentum. We are steadily regaining the trust and belief of our competitors, financial markets and international commentators. We now need to believe it ourselves and bring that confidence home.
Minister for Social Protection, Joan Burton, is to revisit her plan to put the cost of the first few weeks of illness for employees on to the employer rather than on the state. The move is expected to save €23m for the exchequer in for one week of illness or €89m if the employer paid for four weeks of illness.
The change was suggested before the budget last december but was put on hiatis due to criticisim from employers and business owners.
The Minister said yesterday she was beginning a consultative process on the introduction of such a statutory sick-pay scheme where the employer shares some of the cost.
She said it was the beginning of the consultative process with employers and nothing had been decided yet. If statutory sick pay were to be introduced it could entail the employer being asked to continue paying the employee €188 per week in benefit. The period could be as short as the first week of sickness, or up to four weeks of illness.
However, employers’ group IBEC criticised the move saying that such a move would be at odds with the Government’s jobs strategy. It said employers already paid billions in PRSI to cover the cost of sick leave.
Mark Fielding of the Irish Small and Medium Enterprises Association said there was a problem with absenteeism in the public sector but not in the private sector. “It’s false accounting by pushing the whole cost to employers. If this was pushed through, and we had to pay for the first week or four weeks, we would end up with jobs being lost”.
While there is no doubt that there must be some burdening sharing on this issue, the timing of this is completely wrong. We hear so much about getting people to hire staff and yet the incentives to do so are cut on a weekly basis. If the government wants businesses to employ it must choose the right time for actions such as this.
Major business groups give their reaction to one of Ireland’s most Austere budgets. With this being the first of a further three to four austerity budgets coming over the next few years how would they react? Continue reading
#SMEcommunity is a group set up on Twitter by SMEs for SMEs, the aim is to support, encourage, help and advise each other through Social Media. It started with a simple tweet on 16th June between Debbie Harper of Tus Nua Designs and Kehlan Kirwan from FocuSMEireland. Very quickly other Irish business people joined in and by the end of the evening #SMEcommunity was trending in Ireland. Continue reading