Four-year high in firms’ confidence

Confidence among Irish companies has improved strongly since the start of this year and is currently at its highest level for nearly four years, according to employers’ group Ibec.

The organisation’s latest business sentiment survey, covering the first three months of 2013, shows its best results since being established in 2009. Respondent companies said they expect further growth in their sales and order books this year, with one in four likely to hire new employees in the coming quarter.

The survey’s “current conditions” index, measuring CEOs’ perceptions of the overall business environment, rose from -14 to -6 on a quarter-by-quarter basis, with the “forward-looking index” up from -13 to -4. It is the first time that both of these have been near the neutral 0 mark.

Ibec chief economist Fergal O’Brien said the rise in confidence is due to a recovery in the domestic economy.

“Consumer spending and business investment made a positive contribution to growth in the second half of last year and CEOs expect this trend to continue into 2013,” said Mr O’Brien. “The Irish economy is clearly re-balancing and it is very positive to see the sentiment readings for both domestic and export activity in positive territory in the first quarter of the year.”

Managers’ confidence in their own businesses also improved to a new series high, up from +15 to +19.

Ibec urged the Government to focus on reducing expenditure and growing the economy, rather than further increasing taxes.