Business is '˜holding its breath' says InterTradeIreland

The majority of firms across the island of Ireland remain stable but levels of growth are declining sharply according to the latest data released by cross-border business agency InterTradeIreland.

Brexit is beginning to have a more obvious impact on how companies think and behave says InterTradeIreland director Aidan Gough
Brexit is beginning to have a more obvious impact on how companies think and behave says InterTradeIreland director Aidan Gough

Its Quarterly Business Monitor for January to March indicates the findings are consistent across companies both large and small.

While not a cause for concern at the moment, the agency warns the economy is poised to enter a “critical phase” with businesses across the island taking a collective pause on many key decisions.

In both the Republic and Ireland and Northern Ireland, the report says few firms are hiring extra staff or making investment decisions and business and consumer confidence is increasing as a concern across all industries.

In particular, construction is feeling the pinch at the moment, with a significant drop in those in a growth position, falling from 42% last quarter to 16% this quarter. More than one in five in the sector are operating below capacity and only 4% are reporting an increase in sales.

“Overall, there is a sense that business across the island is holding its breath and we are at a crossroads,” said Aidan Gough, InterTradeIreland’s designated officer and director of strategy and policy.

“The number of businesses reporting to be in stability mode is at the highest level since we began recording business position in 2011.

“While this is in no way cause for alarm, we also see that companies in growth mode is at the lowest mark since 2009.

“Firms are operating against a backdrop of increasing pressure on the high street, the spectre of inflation, salary increases and uncertainty around Brexit.”

Given that, he said it was understandable that many businesses might be feeling hesitant.

“With hiring flat, staffing is likely to further come into the spotlight with the impending Brexit. 13% of businesses with cross-border sales have staff in the opposite jurisdiction and 15% of those in the leisure industry in Northern Ireland have staff from the rest of the EU.”