Brexit weighs on business sentiment

Brexit weighs on business sentiment

Over half of businesses in the Republic and the North are pessimistic about the effect Brexit will have on their business in the next five years, the survey found.

Fewer than one in 10 businesses felt Brexit had a positive impact. Currency fluctuations benefited the 50% of businesses in the Republic importing from the UK, while the 20% who export to the UK have been feeling the cost of weaker sterling.

The tourism and hospitality sector is least optimistic about the future, while a significant percentage of retail, transport, manufacturing, technology, media food and professional services were pessimistic.

In the joint KBC Ireland and Chartered Accountants Ireland business sentiment Autumn survey, Irish companies reported slightly softer slower growth as Brexit risks persist.

The vast majority of firms don’t see overheating in their operations at the moment, while two-thirds say an increase of 2% in pay would be the norm for 2018.

Very few firms are seeing no rise or increases above 5%, with construction firms featuring prominently in those companies expecting no increase in pay next year, the survey found.

About half of Irish companies are not focused on Brexit, the survey found.

KBC Ireland chief economist Austin Hughes said: “Only one in five Irish-based firms doesn’t envisage any impact on their business from Brexit. Companies are now slightly more pessimistic in their assessment of Brexit on their business and roughly half see the peak impact being felt by March 2019.

“As a result, it is slightly surprising that the survey found no major pick-up in Brexit preparations of late and one in two companies reported they had no significant focus on Brexit at present.”

Chartered Accountants Ireland chief executive Barry Dempsey said firms are still reporting solid growth, but the increase rate appears to have eased.

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