Saturday, June 25, 2022

Sharp decline in setting up of new companies but trend of buck in rural areas

The number of new companies registered in Ireland fell 12 percent in the first three months of this year compared to 2021, although rural counties did better.

The data collected by the company’s information experts CRIFVision-Net points to a decline in inflation in urban centres.

Company start-up growth slowed in manufacturing (-32 pc), motoring (-19 pc), transportation, warehousing and communications (-15 pc), and health and social work (-10 pc).

The main sectors driving the trend were businesses involved in electricity, gas and water supply (+26pc), hospitality (+14pc), and construction (+5pc).

There was also a significant increase in the number of new enterprises launched in the mainly rural counties of Leitrim (+42pc), Longford (+35pc), Laois (+21pc) and Wexford (+13pc), but in counties with large urban populations. a decline was recorded.

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Data suggest that economic tailwinds, such as inflation and declining business and consumer sentiment, along with supply-chain vulnerabilities, could dent business founders’ ambitions.

The record pace of job creation and the resulting skill shortage may also have convinced more people to stay in employment rather than risk going out on their own.

Urban hubs such as Dublin, Cork, Galway and Limerick, where the job market is strong, saw a decline in company start-ups.

Christine Cullen, managing director of CRIFVision-net, said uncertainty has characterized the economy since the lifting of COVID restrictions and the start of the war in Ukraine. “The 12 per cent reduction in new company start-ups indicates an inherent hesitation in the domestic and global economies,” she said.

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But she said there were signs of optimism, including new growth in more rural locations, perhaps as a result of people moving away from cities, as well as helped by housing shortages and higher property prices in urban centers.

“Some of the uncertainty is offset by the rebound felt in the hospitality and construction sectors, the two industries that suffered the most due to the pandemic health restrictions. Some may assume that people will not have disposable income to spend in our bars, hotels and restaurants, but the 14 percent increase in hospitality suggests optimism in the sector.

Nation World News Desk
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