Firms bullish about 2005

SMALL and medium businesses are bullish about the prospects for 2005.

A survey shows that employment prospects are particularly good, with 41% of small companies surveyed expecting to increase employment by 25,000 in 2005.

The SME sector says our immigration policy is the key to filling these vacant positions.

The only major threat on the horizon is high labour costs, which were identified as a main threat to future prosperity.

Irish Small and Medium Enterprise organisation (ISME) chief executive Mark Fielding said the SME sector will continue to be at the forefront of job creation, with the association anticipating that 25,000 jobs will be created by smaller businesses over the next 12 months. Many of these positions will have to be filled by immigrants.

"It is absolutely essential that a comprehensive planned and managed immigration policy is developed and that we move away from the ad-hoc reactionary approach to migration evidenced to date. This will ensure that migrant workers and their families can become more easily integrated into Irish society and provided with the support structures including housing, long term settlement and education, leading eventually to full citizenship rights," he said.

The biggest threat domestically continues to be the high-cost environment in which companies operate, particularly labour costs, which continue to increase at levels well in excess of our European counterparts.

"It is absolutely essential that future wage rates are not allowed to get out of control, as has happened previously, resulting in Irish wage rates increasing at two and a half times the rate in the rest of the EU. This is simply unsustainable and, if allowed, will seriously undermine Irish competitiveness," said Mr Fielding.

While the association is anticipating solid growth in the SME sector over the next 12 months, the combined threats of a continuing weakening dollar and high oil prices in the immediate future could have negative consequences for our inflation rate and competitiveness.

Overall, the omens are positive for 2005.