Ibec has today published its latest Quarterly Economic Outlook which forecasts growth of 4.2% for 2017 and 3.2% in 2018.
The group that represents Irish business believes a strong labour market, in particular, will underpin the buoyancy of the domestic economy, but Brexit related trading challenges will remain for exporters. This will be a particular challenge for the regions, with Ibec analysis showing some counties are five times more reliant on Brexit exposed industries than Dublin.
The analysis shows that around 243,000 workers, or 13.2% of the employed population, work in the most Brexit exposed sectors such as agri-food and beverages, tourism, transport and traditional manufacturing. The counties with the highest exposure to a ‘hard Brexit’ are Cavan (28%), Monaghan (27%), Kerry (22%) and Longford (21%) with over one in five workers in each of those counties employed in exposed sectors.
Meanwhile exposure is lowest, as expected, in urban areas. The least exposed counties include Cork and Galway cities along with the four Dublin local authorities and their surrounding counties.
Ibec have today noted that indigenous exports to the UK have recovered some lost ground in the first half of 2017. But there will be increased volatility as the year goes on, with sterling depreciating once more since the UK election. No matter what the outcome, Ibec warns that the Brexit will hurt both Ireland's indigenous exporters and rural regions disproportionately. The group is calling for Budget 2018 to include measures to protect these vulnerable sectors.
Speaking today, Ibec's Head of Tax and Fiscal Policy, Gerard Brady said, "The Irish economy is now in a strong position with forecasts showing the pace of employment growth will run above 3% this year for the first time since 2007. All indicators suggest that the labour market is now tightening rapidly and weathering any Brexit uncertainty well."
He added, "The business substance within the private sector is driving this growth with business employment, excluding in the agriculture sector and the self-employed, up by 5.2% in Q1. We expect unemployment will be below 6% by the end of the year."