Business confidence is stabilising, survey finds

BUSINESS confidence is stabilising and the outlook for profits and job creation is increasingly positive, according to a Cork Chamber survey.

But labour costs and the continuing economic uncertainty are still the biggest concerns for firms employing less than 100 people. Cash flow also remains a serious problem.

The trends emerged in Cork Chamber’s second-quarter economic survey, released last night.

Cork Chamber represents the interests of over 1,000 businesses employing 80,000 people in the region.

Its first-quarter survey in April showed that 78% of respondents were still confident in their business’s financial future.

The latest survey shows that percentage remains unchanged, and that:

nNearly half (49%) of members expect net profits to increase over the next 12 months, with 23% expecting them to remain stable;

n40% reported an increase in turnover in the last 12 months, with 20% saying turnover had stayed stable;

n29% of businesses hired more staff in the last year, with nearly one in five increasing their employee numbers by over 10%;

nOne-third expect to increase employee numbers in the next 12 months;

n52% expect employee numbers to remain stable, while 14% expect to employ less people over the same period, compared to 22% of businesses expecting job losses in the first-quarter survey.

Chamber president John Mullins said: “These figures show that confidence amongst businesses in the Cork region is consolidating, with a positive outlook for employment prospects and future profitability.

“The sector reporting the greatest increases in jobs was ICT, underlining Cork’s attractiveness to the sector.”

Clive Aherne, who set up TaxAssist Accountants on Washington Street in the city 18 months ago, employs two people and is planning to hire a third within a few weeks, and at least one person a year for the next few years.

“You can see growth and people becoming more optimistic,” he said.

His year-round business advice company is part of the TaxAssist Accountants network, which has created over 30 jobs nationwide in the last year.

“We can see that sentiment is going in the right direction and we are getting the same feedback from clients,” Mr Aherne said.

But Mr Mullins said the Government must continue to take steps to build confidence in the economy to help small firms.

The survey also sought opinions on the banking sector and credit, finding that 40% of respondents felt their bank is supporting their business adequately; 31% disagreed.

Just over half (52%) of those people who tried to reschedule their credit facilities were happy with the bank’s response, while 35% were unsatisfied and 13% are still awaiting a decision.

The survey shows that cash flow is still an issue, with 61% saying it is taking longer to be paid by debtors while 18% say they are experiencing delays in receiving payments from state bodies.

And 61% of respondents support the introduction of domestic water charges to help fund local government.

However, the number opposed to a property/site value tax continues to increase, rising from 45% last year to 56%.