Optimism about economy grows among Cork firms, survey finds

The survey, which was conducted in Q4 2022, showed many business operators are still concerned about their energy bills this year. Pic Larry Cummins

Confidence in the Irish economy among Cork based firms grew heading into 2023, despite ongoing challenges such as skills shortages and cost pressures due to the inflation crisis. 

Cork Chamber’s latest Economic Trends report found confidence in the economy among Cork firms jumped to 66% at the end of 2022 compared to 47% in Q3.

“Falling confidence had been part of a consistent trend in 2022,” said Cork Chamber president Ronan Murray. "This uptick in business sentiment on the wider economy is a very positive signal heading into a challenging 2023."

The majority of respondents to the survey said the current skills shortage is a barrier to further growth this year.

“We are keen to continue to work closely with Government to address any bottlenecks that exist, which could constrain business expansion and investment,” said Mr Murray.

Cork Chamber president Ronan Murray: 'Almost three-quarters of businesses still concerned about the rising energy costs'. File picture: Denis Minihane

The proportion of companies having difficulty hiring for vacant roles jumped to 64% in the fourth quarter from 43% of companies in the third quarter. 

Specialist skills shortages remained the single largest factor affecting companies’ recruitment efforts at 65% up from 52% in the third quarter, with this trend consistent throughout last year, the report stated.

The survey showed many business operators are concerned about their energy bills — half of respondents said Government supports are not sufficient to cushion the rising cost of energy. Mr Murray said: 

Although the level of business concern has tempered, it remains high, with almost three quarters of businesses still concerned about the rising energy costs.

The report suggested that business supports will need to be revisited and reinforced by Government as energy costs are likely to continue to affect businesses into 2023.

Energy costs increased across all sectors last year, prompting a likely erosion of profitability and a threat to business viability, stated the report.

Yet 40% of respondents reported a net profit rise in the fourth quarter, up from 37% reporting a net profit increase in the previous three-month period, despite expected reduced profitability due to soaring energy costs.

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“Although energy costs continue to be a challenge, it is reassuring to see respondents taking a proactive approach, with 21% identifying energy efficiency as a priority action to combat rising prices, closely followed by improving productivity and reducing overheads,” said Auriol Kelly, business banking manager at Permanent TSB, which sponsored the report.