Confidence is rebounding among Irish exporters, 30% of whom plan to recruit new staff in the next three months.
Employer group Ibec’s latest Business Sentiment Report for Q1 2012 shows a significant improvement in business confidence after a sharp decline at the end of last year.
Domestically trading firms, however, continue to have a negative outlook. Of the 400 firms surveyed, a third of non-exporters plan to decrease staff numbers.
Overall, order book expectations reached a three-year high of +27. Exporters’ confidence is up, with medical devices and IT showing the highest confidence levels.
The export sales reading jumped to +43, up from +29 in Q4 2011.
Ibec chief economist Fergal O’Brien said: “Exports continue to drive the recovery and it is crucial that nothing is done toundermine the ability of Irish companies to trade internationally. In 2012, efforts must focus on restoring more normal levels of activity in the domestic economy.
“New thinking from the Government and the troika is needed to stimulate consumer activity and get the domestic economy back on track.
“Business is now less concerned about the eurozone crisis. The final quarter of last year was an anxious time for the European economy and Irish business saw this reflected in its order books.”
Irish firms’ self-confidence has jumped 12-15 points, with pharma, medical devices, industrial products and IT services all notably positive. However, retailers and wholesalers had a negative reading, and 69% of retailers expect a decrease in sales in the next three months.
Fergal O’Brien said: “The two-speed nature of the economy is clear, with the outlook for domestic sales remaining challenging. While it was encouraging to see 10,000 jobs created in the final quarter of last year, a significant improvement in the domestic economy is needed to tackle the unemployment crisis.”
Meanwhile, KPMG has also issued a positive Business Leaders Survey. Executives surveyed believe recent cost-cutting moves have made Irish businesses better prepared than their competitors to exploit any upswing.
They believe Irish firms are more focused, by a margin of 18%, on raising capital and improving working capital management. They also say they are more focused on growing via transactions by a margin of 9% over most other countries.
KPMG partner Colin O’Brien said: “Irish companies are moving to a new more developmental phase in how they are dealing with what is still a challenging macro- economic picture.
“The Irish appetite for transactions offers the best prospect of growing the bottom line. The fundamentals that led to the spectacular growth over a 10 to 15-year period have not gone away.”
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