Services sector sees 'robust' growth during December

During December, the PMI had a reading of 57.1 — a decrease from the 58.3 recorded in November but still a positive indication of growth.

Chief economist with AIB David McNamara said the expansion in December was driven by a “rapid increase in new business” with “solid gains” being made in outstanding business and employment.

"The expansion in Irish services sector activity was underpinned by strong demand conditions. New business rose at its fastest pace since March and new export business growth accelerated to the fastest pace since May 2023,” Mr McNamara said.

The volume of outstanding work also picked up and employment growth reached a four-month high, linked to firms targeting skilled and experienced staff to enhance business structures and meet workloads. 

All four services sub-sectors registered growth during December with transport, tourism, and leisure recording the fastest growth with a PMI of 60.9. The other three sub-sectors — technology, media, and telecoms; financial services; and business services — recorded PMIs of 56.9, 55.9, and 55.9, respectively.

“However, hiring activity was more mixed across the sectors. Technology, media and telecoms was the top performer, while employment was essentially flat in the financial services sector,” Mr McNamara said.

During the month, inflationary pressures also rose with average input prices increasing at the sharpest rate in seven months and charge inflation remaining above the long-run survey trend.

In terms of the outlook for 2025, 47% of companies said they expect business activity to increase over the next 12 months — up from 40% in November.