Cork business optimism soars amid concerns

Businesses in Cork are as confident as they have been at any stage in the last six years, but are increasingly unsure of the impact of government policy on stabilising the economy.

Cork Chamber’s second quarterly economic trends report of 2015 paints a positive picture for Cork-based businesses, with high levels of confidence and increases in employment among the main findings. The survey points to widespread optimism across a range of sectors.

Business leaders almost unanimously expressed confidence in the financial future of their companies, with more than 96% sharing this view — the highest level on record since the survey began in 2009.

Welcoming the buoyant mood of businesses, Cork Chamber president, Barrie O’Connell, highlighted the marked difference between this quarter’s results and those of just a few years ago.

“The survey — which incorporates responses from businesses of all sizes across a variety of industries — reported that 96.6% of businesses are confident in the financial future of their businesses, this is the highest level on record since the Chamber’s Economic Trends Surveys commenced in 2009 when only 51.5% reported confidence in the future of their business,” he said.

Confidence levels have picked up on the back of reported and projected rises in turnover and net profit. Some 60% of firms reported an increase in turnover in the second half of 2015 and 68% project increases in the coming months.

And, 64% predicted a rise in net profits in the third quarter of this year. Firms reported good news for prospective employees too with a trend of rising head counts likely to be carried over from this quarter into the next. A widening divide is evident between those firms taking on new staff in the past three months (44%) and those cutting their workforces (6%).

Some 35% of respondents predict they will increase staff levels over the third quarter, with only 5% predicting they will decrease the number of staff they employ over the same period.

Businesses too are willing to give the Government credit for their role in reducing unemployment with 40% believing its job creation policy has had a positive effect while only 8% consider it to be negative.

The picture isn’t all rosy for the Coalition, however, with firms reporting dwindling confidence in its ability to restore fiscal stability.

While 45% feel it has been successful in this regard, support has fallen by almost a fifth since the end of 2014 despite improving economic trends.

Echoing a report from the National Competitiveness Council last week which warned the country’s ability to compete with its international peers on price is under threat from a growing array of angles, the Chamber report ranks price competitiveness among the top three dangers to business growth.

Investing in crucial infrastructure projects in the region tops businesses’ wishlist ahead the budget with road improvements and better air connectivity from Cork Airport among the chief concerns.

Targeted investment in skills, education and health along with efforts to reduce the tax burden and support SMEs also featured prominently.

Asked to identify a specific measure they would like to see included in Budget 2016, a reduction or elimination of USC proved the most popular among business leaders.