Business brisk but wages will stay flat for rest of 2014 – survey
MORE Irish businesses reported rising output in the final months of 2013 than at any point in the last six years, a new survey has found.
More than half of the firms surveyed in the latest KBC/ Chartered Accountants Ireland business sentiment survey said that output had increased in the last three months of last year – the largest percentage to say that since summer 2007.
“The results of the winter business survey point towards a clear further improvement in Irish business at the turn of the year,” said Chartered Accountants Ireland chief executive Pat Costello.
“These results suggest a broad recovery in business conditions is taking hold.
“A still challenging environment means that one in eight companies reported weaker conditions but, unlike the experience of recent years, companies reducing output are now very much the exception rather than the rule,” he added.
Jobs growth was only slightly better than the previous three- month period, the survey found.
But encouragingly, the greatest improvement in hiring came from smaller companies.
Companies suggested they would continue to hire as 2014 progressed; 42pc plan to increase employment in 2014 compared with 10pc that envisage a decline in their staff numbers.
However, low selling prices mean very few businesses expect to give pay rises, the study found. One-third of companies expect average pay to remain unchanged. Another third expect increases of less than 2pc and just 18pc saw pay rising 2 to 5pc.
“Although companies are reporting stronger activity levels, the majority indicate that selling prices in the markets in which they operate are flat or falling.
“This is likely to be a key influence on their expectations of very modest pay increases in the coming year” said KBC Ireland chief economist Austin Hughes.