Bosses expect rise in staff numbers

ONE-in-four chief executives surveyed say they expect to increase employee numbers next year.

Half of company bosses believe that European Central Bank (ECB) base rates will remain unchanged next year, while the remainder expect interest rates in the Eurozone to rise slightly next year.

Two-thirds, however, expect residential property to decline in value over the next three years, according to a survey of 1,000 Irish chief executives by commercial property firm, CB Richard Ellis.

Two-thirds of Ireland’s top chief executives expect the Irish economy to show positive growth in 2011 but of those, a majority expect growth of less than 1%.

Almost half of chief executives are less optimistic about Irish economic prospects in the short to medium-term than they were 12 months ago, while two-in-three said that the ongoing banking crisis is the factor having the greatest negative impact on the Irish economy.

Restoring Government finances (49%), progressing NAMA (41%) and reducing the unemployment rate (38%) are the factors in need of most urgent attention in 2011, according to chief executives.

Guy Hollis, managing director of CB Richard Ellis, Ireland, said: “Given the broader economic backdrop and recent newsflow, it is no surprise that expectations for 2011 are for modest growth at best. Our respondents have clearly identified Government finances and unemployment as the two factors which require urgent attention in 2011.

“As a firm, CBRE has a truly international perspective, and we share the view that the Government must urgently address its deficit and work to restore confidence in Ireland in the international capital markets and among international investors. As investor confidence in Ireland returns, it should have a positive impact on both employment and on the commercial property market.”

Four-out-of-five chief executives are less favourable towards commercial property in Ireland as an investment, compared to this time last year.

Three quarters cited bank deposits as their preferred investment choice in the current climate.

The sectors of the commercial market likely to out-perform over the next three years are the Dublin office and Dublin retail sectors.

Four-out-of-five respondents said they were less favourable to residential property in Ireland than they were 12 months ago.

Just over one fifth of Ireland’s top company bosses expect residential property in Ireland to appreciate in value over the next three years.

A further 12% anticipate that residential property values will remain stable at current levels, while more than 50% expect further slight value decreases and almost 15% anticipate further significant decreases in house prices in the time period.