Survey of company bosses gives upbeat economic view

Despite the weaker economic climate, business confidence for the future of an all-island economy remains resilient, according to a report issued today.

Four out of every five respondents to the First Annual Report of the Business Monitor published today by BT and InterTradeIreland said they were optimistic about their company’s performance over the next three years.

All the respondents were either managing directors, CEOs or company proprietors. Four thousand companies across the island, ranging from small enterprises to large multinationals, participated in the survey.

Whilst 78% of business agreed or strongly agreed that the credit crunch would impact on the economy in the coming 12 months, the majority of these felt the impact would be moderate.

Some 86% expected to increase or maintain employment in the coming three months, although 25% of businesses stated that they had difficulty filling vacancies.

Despite the prevailing tough economic conditions, evidence of an emerging and growing all-island economy is apparent in the findings, with 62% of companies North and South do not intend to revise business targets downwards.

Indeed, of the 41% of companies engaged in cross-border trade, two thirds expect their volume of trade to increase in the coming months.

The state of the island’s infrastructure was a common area of concern to businesses - 53% said planned investment would improve transport infrastructure over the next three years and 72% of all companies surveyed believed this would help North/South links.

BT’s chief executive Chris Clark said the findings show an economy under pressure but positive about the future.

“Around 80% of businesses are optimistic about their company’s performance over the next three years,” he said. “However there appears to be a short-term issue because 78% of companies admit the credit crunch is a serious issue with 77% already noticing a tightening of expenditure by customers and competitors.”

“From working with organisations of all sizes across the island, those businesses who have created a sustainable business model, and are able to adapt quickly and use innovative solutions, are the most optimistic about facing the challenges posed by the credit crunch.”

InterTradeIreland strategy and policy director Aidan Gough said: “In tough economic times, trading on an all-island basis offers companies North and South a golden opportunity to grow their business by expanding into new markets which are right on their doorstep.”

Gina Quin, CEO, Dublin Chamber of Commerce said that “the secure and stable political environment - North and South - has meant that there are increased cross-border growth and development opportunities available to businesses looking to expand their operations. This Monitor assists businesses with their investment and development decisions”.

The news was not al positive however, with the number of firms expecting profits to rise in the coming quarter fell from 41% to 31%.

Economist Marc Coleman, who analysed 12 months of results and provided a commentary on their impact, said: “Businesses perceived lack of progress in addressing the North’s corporation tax rate is affecting the way government is viewed. In the South the high cost of living and the level of business taxation are key concerns. And right across the island there is a very real concern about the ability of the education system to adapt to new economic realities.”