Business confidence in the SME sector improves
- 9 out of 12 confidence indicators remain positive
- Business confidence improves by 12%
- 38% of businesses will not increase pay for employees this year
- 62% of Owner-managers will not increase their own pay this year
- 29% of businesses claimed inadequate broadband
- 53% of companies find it difficult to hire new staff
The results of the ISME Quarterly Business Trends Survey for Q4 2017, released today show confidence in the SME sector continuing to improve.
9 out of 12 confidence indicators remain in positive territory.
Business confidence is up 12%, while profitability expectations are up 2%. The Trends report also publishes information on employee and employer pay increases, broadband services, and staff retention in the SME sector.
Commenting on the results, ISME CEO, Neil McDonnell said: "We welcome the continued improvement in our confidence indicators.
"However, there are still many challenges facing the SME sector across the country. The manufacturing sector, in particular, experienced a reversal in its confidence indicators, with 6 out of 12 indicators declining in Q4 '17.
"Furthermore, we see SMEs, especially in rural Ireland facing challenges such as inadequate access to broadband (29% of respondents). This is an unacceptably high figure for a country that prides itself on the smart economy."
The survey was conducted in the third week of January, with 492 SME respondents, 53% of whom employ less than 10; 39% employ between 11 and 49; and the remaining 8% employ between 50 and 250.
Geographically, 35% are from Dublin; 54% are spread across the rest of the country; and 12% have multiple sites.
The Q4'17 Business Trends Quarterly survey showed positive gains for the final quarter of 2017.
9 out of 12 confidence indicators continue to show positive results.
There was an increase in: Business Confidence (up 12%); Business Expectations (up 17%); Business Environment (up 6%); Profitability Expectations (up 2%); Future Employment (up 10%); Sales Expectations (up 10%); and Current Investment (up 10%).
There was a decline in Current Sales in Q4'17, down from 31% to 28%. Current Employment is also down marginally from 33% to 32%, while Export Expectations are down from 40% to 32%.
It is important to note that Business confidence is at twenty-one month high, its highest since Q1'16.
"While we are moving in the right direction, with business confidence at a twenty-one month high, more needs to be done by government.
"We have made recommendations to government in light of the challenges facing the SME sector, from pay, high cost of insurance, access to broadband and the high cost of living; the SME sector would be a healthier place for employers and employees if the government took our views on board," he added.
