Covid-19 nearly caused 10% of Irish businesses to close, now they must battle new dangers 

Real estate and hospitality sectors had the highest proportion of business that appeared closed by the end of 2021. 

More than 10% of business trading were at risk of closing down at the end of last year, new figures from the Central Statistics Office (CSO) show.

Almost one in eight micro-enterprises that were trading normally in 2019 were at risk of closing at the end of 2021. This was followed by almost 4% of small enterprises, whereas less than 2% of both large and medium enterprises were in this category.

The highest proportion of enterprises that appeared to be closed by the end of 2021 were in the real estate and the accommodation and food services sectors.

Gyms and hairdressers were among the most at risk for closing by the end of last year, stated the CSO. This was followed by construction enterprises and those in hospitality. All of these sectors were significantly impacted by the restrictions put in place during the pandemic.

“There were also more than nine in 10 medium enterprises at 96% and small enterprises at 94% which survived at the end of 2021. Micro enterprises had an 81% survival rate,” stated statistician Sorcha O’Callaghan.

Business Survival Rate at the end of 2021 was 84%https://t.co/55QQtpOpJv #COVIDIreland #CSOIreland #Ireland #Households #Families #IrishFamilies #IrishHouseholds #LabourMarket #Jobs #Employment #Business #BusinessSignsOfLife pic.twitter.com/bdzOpYi3gu

— Central Statistics Office Ireland (@CSOIreland) May 3, 2022

Although the pandemic restrictions have been lifted and the majority of businesses surveyed by the CSO are still in operation, danger still looms in the form of wage inflation and energy price hikes.

Nearly 90% of Dublin businesses alone reported a rise in non-wage business costs in the past year, with energy prices identified as the main driver.

Meanwhile, 86% face wage inflation, with just under half of these seeing wage costs rise by 6% or more, according to Dublin Chamber’s most recent Business Outlook Survey.

“Decades of poor housing supply in Dublin have exacerbated an already tight labour market. Many firms face double- and even triple-digit increases in energy prices. As a result, companies are looking to implement energy-saving measures, which would have been unviable a few short months ago,” said Dublin Chamber’s director of public and international affairs Aebhric McGibney.

Nearly 80% of businesses surveyed by Dublin Chamber stated that attracting, retaining and upskilling staff was chosen as a key priority for 2022, signalling widespread reports of skill shortages and retention difficulties.

However, when asked how they expected their company’s staff numbers to change over the next three months, over half of the respondents had a positive outlook and expect staff numbers to increase.