Survey: Multinationals in Ireland predict growth in 2011

Almost half of multinationals in Ireland are expecting to grow exports in the next 12 months, according to a new survey released today.

The Irish Management Institute / National Irish Bank Survey of Multinational Corporations (MNCs) in Ireland for 2010 also revealed that 26% expect to increase employee numbers in 2011, although 22% expect a decrease.

However Ireland’s cost base is still significantly higher than comparable locations despite falls in wages and prices over the last 24 months, according to respondents.

Respondents also stressed the importance of maintaining the current corporate tax rate in order to attract new jobs to Ireland.

“While the survey last year indicated the extent to which companies were cutting staff in the face of falling order books, this year over half of respondents don’t foresee any change in the size of their workforce over the coming year,” said Irish Management Institute CEO Dr Tom McCarthy.

“In fact, more of them see their employee numbers increasing than decreasing… 47% predict that their turnover will increase in the coming year, compared to just 11% who foresee a decline.”

Almost two out of every three companies (62%) in the survey characterise their operations in Ireland as being of either global or regional significance, including in the production of a particular product or service, pointing to the success of Ireland in attracting higher value investments over the last decade.

“We have gone some way over the past two years to improve our cost competitiveness, but firms are telling us that more needs to be done,” said NIB Chief Economist Dr Ronnie O’Toole.

“More positively, while Ireland’s infrastructure was historically seen as poor relative to our competitors, this is no longer identified as a problem by the respondents, indicating that large infrastructure spending in recent years is paying dividends.”

“Looking forward, while there had been fears that the world economy would suffer a ‘double dip’ recession, these fears have now passed and we can look forward to demand growing in our major export markets,” Dr O’Toole added.

“If Irish-based firms can continue to win market share, then we can be confident that exports will provide an engine for our economy over the next two to three years. ”