Irish small business owners are less confident facing into the new year, citing concerns about Brexit and wage inflation, and with just one in two expecting the environment to improve in 2017, down from more than three quarters last year.
According to a survey from the Small Firms Association (SFA), half of owner-managers feel the business environment is improving, down from 77 per cent one year ago and 66 per cent in May. Moreover, 18 per cent of respondents said that the environment is actually disimproving.
"2016 has been a challenging year for small business," said SFA director Patricia Callan. "The optimism that existed at the beginning of the year has given way to a much more cautious sentiment among small businesses, due to emerging wage demands, Brexit and downward revisions of growth forecasts."
Still, she added, “52 per cent of SFA members say their businesses are growing, with only 9per cent declining. This shows that 2017 still has the potential to be a strong year if the risks are managed effectively at firm level and Government level.”
Growth opportunity
Domestic economic growth was highlighted as the biggest business opportunity by a third of respondents. Other positive factors included specific sectoral opportunities, bringing new products to market, new brand/marketing campaigns, and exporting.
Almost two-thirds of respondents said they will recruit over the coming year, although this is down slightly from a pre-Brexit survey in May.
On the risks front, concerns include wage inflation, cited by 22 per cent of respondents, the Brexit/sterling exchange rate, domestic economic stagnation and cashflow issues.
“Many of these require decisive measures at Government level,” Ms Callan said, “and the SFA will work with the Department of Jobs, Enterprise and Innovation and other departments to ensure the appropriate actions are taken.”
She also called for full tax equalisation between the self-employed and employees in 2017, as will access to public contracts for small firms and cost competitiveness.
