Thursday, January 02 11:20:51
Ireland's small and medium sized businesses could create up to 50,000 new jobs this year if the Government provides the right environment, according to the Quarterly SME Business Trends Survey for Q4 2013, today by ISME.
It found annual improvements in 11 out of 12 key economic indicators were reported. A general feeling of optimism is apparent in the results, with a welcome indication of jobs' growth, though issues in certain sectors such as retail and exports were reported. 7 of the 12 indicators have showed sustained improvement in every quarter of 2013 and all indicators except for current exports have improved on the same quarter of 2012.
Business Confidence has increased from -5pc to +42pc and Business Expectations have gone from 0 to +52pc in the space of a year.
Economic uncertainty is now at the lowest level since Spring 2007 and continues to be the biggest concern for employers. Sales expectations in December 2013 are a very positive 28pc but this confidence is not felt across all sectors, most notably Retail, where sales expectations dropped to -35pc from -23pc in the final quarter. Both current and future employment experienced relatively strong increases in this quarter, in line with current and future sales. Current Investment remained static at 26pc, a sign that, though economic recovery appears imminent, owner-managers are still unable to gain sufficient access to credit to expand and grow their businesses.
Mark Fielding, ISME Chief Executive, commented on the results, "As we enter the post-bailout era SMEs are cautiously optimistic about the future. 11 of the 12 indicators have improved on 2007 levels at this point. However, owner-managers are still concerned about economic uncertainty and the upturn is not being felt equally across all sectors".
"Retailers, in particular, are not benefitting from the reported increase in domestic demand and current sales have dropped from -23pc to -39pc. Unfortunately, this precarious situation means that jobs will be lost in Retail due to Government inaction."
"Interestingly, both export indicators decreased in this quarter. Rhetoric about an 'export-led recovery' will amount to nothing if action is not taken to analyse the reasons for export drops and to ascertain if it is a cause for concern or a simply a cyclical trend. These results, combined with the drop in foreign sales reported by the CSO in mid-December, need to be examined to ensure that preventive measures are taken if the sector is starting to deteriorate".
"On the jobs front, it is encouraging to see a net 18pc of employers expecting to employ more next year, the most positive indicator since Summer of 2007. Based on the previous surveys and employment figures, there is a potential for an increase of 50,000 jobs in the SME sector in 2014. This expectation is predicated on direct action from Government on state influenced business costs."
"The Medium Term Economic Plan released prior to Christmas promised reports and policy actions from all government departments. The plans that come from the government departments in the New Year must be specific, measurable, enterprise oriented and concentrate on business costs so that the employment potential can be achieved."