IoD: Many top Irish bosses brace for hit from rising inflation

Firms fear that inflation and supply chain issues will dent growth during the first quarter of 2022

Maura Quinn, chief executive of the Institute of Directors in Ireland: 'Wage inflation and supply chain issues are sources of real concern for business leaders.'

Over 80% of business leaders fear rising inflation will dent their financial growth during the first quarter of 2022.

A similarly high percentage are concerned that wage inflation will hamper their staff retention and recruitment capabilities, a survey by the Institute of Directors in Ireland shows.

Inflation hit a 20-year high of 5.3% in November, recent CSO figures showed, and economists expect prices to remain high next year if there is no relief in wholesale energy costs and wage pressures in the first half of 2022.

Firms hit by supply chains

The survey also found that over a third of bosses have already seen their profits hit by supply chain chaos this year, with nearly half of them worried about more supply disruption during 2022.

“These are conclusive findings that general inflation, wage inflation, and supply chain issues are sources of real concern for business leaders,” said the institute’s chief executive Maura Quinn.

As businesses continue to grapple with the fallout from the pandemic and ongoing supply chain issues, inflation is casting a shadow over the short-term prospects for the financial performance of organisations, as is staff retention and recruitment.

Wage inflation is the biggest concern for bosses, the survey shows, followed by supply chain constraints.