In the third Economic Trends survey of 2022, Cork Chamber asked members about their experience in the most recent business quarter, Q3 2022 (July, August, September), on the business outlook for the fourth quarter of 2022 and on the impact of energy and inflation on business. This Economic Trends Survey captures a snapshot of business experiences and of the overall operating landscape over the summer months in a period which saw the publication of the Government’s Budget 2023 and continued challenges with the rising cost of energy and inflation.
Cork Chamber members expressed their views on rising energy prices and measures they are taking to combat these challenges. Emerging from these findings, Economic Trends Q3 2022 also shares a picture of how member companies are adapting to the evolving situation and the implications for employment outlook, turnover and net profit and business growth.
Positively, opportunity in crisis has been identified by member businesses with energy efficiency measures ranking as the highest priority action to take to combat rising prices.
- Potential cost reductions/financial incentives
- Climate/sustainability of government
- Available support/expertise
- Guaranteed RoI
Bearing in mind the clear prioritisation of energy efficiency reported by companies, the Economic Trends survey Q3 2022 found that:
- 8% of companies are planning to reduce production or trading hours to combat rising costs.
- 9% of companies are planning to reduce staffing/headcount.
- 26% of companies reported that energy saving is a factor in their business work from home policies.
- 20% of companies are planning to seek finance/borrow funds in the next quarter.
The above findings seem to be a moderate business response to current conditions.
Inflation and the energy crisis are impacting confidence in the Irish economy with a marked fall in confidence – for the first time in 2022 a majority of businesses are now not confident in the Irish economy (51%).
A tight but a possibly more stable labour market is evident in Q3 2022 with 38% of respondents reporting company employee numbers increased in Q3 2022, 53% stayed the same and 9% reported a decrease.
Specialist skills shortages remain the main factor affecting companies’ recruitment efforts, although down from 66% in Q2, 43% of companies were having difficulty hiring for unfilled roles in Q3. Housing and wage demands being a barrier to recruitment have risen from jointly 12% in Q2 to 22% and 20% respectively in Q3 2022.
The latest Q3 survey shows that 51% of respondents experienced a turnover increase in Q3 2022, this is the same as the percentage reported by companies in the last two quarters. 49% of respondents anticipate an increase in turnover, 32% anticipate it will stay the same and 19% forecast a decrease in turnover in Q4 2022. On profitability, 37% of respondents reported a net profit increase in Q3 2022, this is down from 42% reporting a net profit increase in the previous quarter. 42% expect their company’s net profit to increase in Q4 2022 while 33% anticipate profits will stay the same, and 25% predict a decrease in profits.
