Chambers Ireland has launched the results of the Irish survey of businesses which contributed to the Eurochambres Economic Survey for 2022 (EES2022).
Eurochambres (the Association of European Chambers of Commerce and Industry) represents over 20 million enterprises in Europe – 98% of which are SMEs – through 45 national members and a European network of 1700 regional and local Chambers has been conducting these surveys continuously since 2002.
The European Data is optimistic but there are significant economic constraints that may limit growth across the EU in the year to come. The lack of skilled workers, access to affordable energy, and increasing labour costs will all be a challenge for businesses.
The EES2022 quantifies sentiment across 52,000 European companies and is the largest survey of its kind in Europe. With a strong correlation between previous EES outcomes and EU-level GDP growth the survey projects growth across the Union in 2022, despite the challenges which the survey highlights.
Speaking this morning at the launch of the Irish data, Chambers Ireland Chief Executive, Ian Talbot said, “Irish Businesses are optimistic facing into 2022. However, there are significant challenges ahead.”
Covid-19 Impacts
Covid-19 is expected to continue to hinder the business environment in 2022, with supply chain disruption being a concern for 59% of Irish respondents. Almost half of firms fear that further cycles of lockdown measures will negatively impact their growth in the coming year, while 48% of respondents have recognised that shifts in consumer behaviour have created uncertainties for their businesses.
General Business Sentiment
General business confidence is high with 54% of firms expecting the business environment in 2022 to be favourable, while only one in eight expect it to disimprove relative to 2021.
Business sentiment has bounced back to pre-Covid levels of positivity, with 80% of firms seeing domestic sales volumes either holding steady or improving.
On employment, 41% of respondents foresee increasing employment levels in 2022, while 56% see their businesses holding steady at current levels.
With a huge surge in investments this year to accommodate business changes related to Covid-19, 56% of businesses expect to continue with current levels of investment into 2022, while another third expect to increase investment.
Export growth as a source of national revenue remains muted, though this is largely related to the low number of SMEs which engage in international trade. Of those that are currently trading internationally 54% expect that revenue will increase in 2022, with only 20% expecting it to decrease.
2022 Challenges
The principal challenges to the Irish economy in 2022 are likely to mirror what Eurochambres has revealed is occurring at the European level. The chief concern is labour costs with two thirds of businesses foreseeing wage pressures increasing in 2022. Next is skills, with 52% of businesses identifying shortage of skilled workers as a major challenge. The third factor which our members highlighted is the affordable access to energy and raw materials.
Source: Chambers Ireland
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