Outlook is a series of AIB reports that examines and analyses the key issues affecting particular sectors within the Irish economy.
Irish banks need to lend to the SME sector if they are to survive and thrive. The fortunes of the banking system in Ireland are inextricably linked to the fortunes of the wider economy. Ultimately, our success as a bank in the future is very much tied to the success of our customers.
Irish private sector firms are less optimistic regarding the 12 month outlook in the wake of the Covid-19 crisis and ongoing Brexit uncertainty according to the latest AIB Ireland Business Activity Report.
The impact of Covid has been extremely wide-reaching and the severity of that impact has varied greatly across different sectors. The same can be said for the recovery, as the report highlights that the speed of recovery for businesses will vary, depending on their activities, markets and customers. For some firms the dynamic environment created by Covid and Brexit will create opportunities for growth or diversification into new markets or product lines.
Irish private sector companies began 2020 in a more upbeat mood according the latest AIB Ireland Business Activity Report. The net balance of companies expecting growth in activity over the next 12 months rose to +37% in February, up ten percentage points on October 2019. This is the first increase since June 2018, ending a sequence of falls that culminated in the worst outlook in nine years at the end of last year. The report is based on surveys conducted by IHS Markit among 650 businesses in the manufacturing and services sectors in the Republic of Ireland between February 12th and 25th.
SMEs are the backbone of the Irish economy and in every village, town and city throughout Ireland they play key role in job creation and sustaining many other local SMEs. The Ipsos MRBI research sheds light on a number of challenges and opportunities facing Irish SMEs in the near future.
Nursing Homes Outlook (November 2019)The outlook for the nursing home sector remains positive as demand for long and short term care beds continues to increase across the country due to Irelands ageing population. Although the sector faces ongoing challenges, AIB are committed to supporting Irish Nursing Homes in delivering a caring society for Ireland’s ageing population.
While still in positive territory the latest round of data gathered for the AIB Ireland Business Activity Insight Report shows a continued period of reduced optimism among Irish businesses. It is clear that the ongoing uncertainty surrounding Brexit and its broader potential impact on the Irish economy is dampening sentiment across sectors with reduced optimism evidenced in many areas such as profitability, future capital expenditure and costs. Positively, projected increase in R&D spending across Irish manufacturing and services sectors is encouraging.
R&D investment is a catalyst for new growth and the willingness to invest shows the resilience and forward planning of Irish firms to explore new products and markets and insulate themselves from some of the direct threats of Brexit.
The Irish manufacturing landscape is changing and companies that invest in R&D will be best positioned to develop, grow and embrace the opportunities that lie ahead. AIB is committed to backing the Irish manufacturing sector as it develops it’s R&D capacity and expands its global footprint.
Tourism in Ireland contributed over €9bn to the economy in 2018. This report takes a holistic view of Ireland’s Hospitality and Tourism sector, breaking it down into four primary subsectors, namely Eating, Sleeping, Drinking and Attractions places. It identifies the breakdown of card spending in each sector by region of Ireland, and illustrates the growth and decline trends of the total and each nationality source market over the past two and a half years.
This report highlights the continued downward trend in growth expectations, particularly in the manufacturing sector, driven by uncertainty on the final outcome of Brexit and slowing economic growth. Although sentiment is still positive overall, it is the lowest it’s been for nine years. While there is optimism in Irish Businesses in relation to employment and profitability growth expectations in comparison to the February survey, with confidence around increasing workloads and job creation, cost pressures will continue to be burdensome in the year ahead. Another positive is that sentiment around business activity in Ireland is higher than the remainder of the Eurozone, however the ongoing ambiguity regarding the final outcome of Brexit negotiations is driving uncertainty.
As the Irish economy continues to grow, the outlook for legal services firms - most of which have recorded strong growth in recent years remains cautiously optimistic. AIB has a positive view of the sector and remains committed to supporting the circa 2,300 legal practices and the 18,000 people directly employed in the sector in Ireland.
AIB are proud supporters of the CBRE AIB Logistics & Supply Chain Confidence Index 2019. We are delighted to join the index in the 4th year of the series as we are now starting to see some real trends in the sector. The logistics and supply chain industry is critical to the success of the Irish economy and AIB is very actively involved in the industry, in terms of providing finance, working capital solutions and other supports.
This business activity survey was conducted during a period of intensified uncertainty due to Brexit, and although sentiment overall is lower than late 2018, it is still in positive territory. Expectations around the performance of the Irish economy, which will lead to increased staffing requirements and capital investment, are supporting this positive sentiment. Whereas cost inflation, lower profits and lack of clarity regarding the impact of Brexit and global trade wars means businesses are more cautious on outlook.
Outlook: Transport & Logistics (June 2018)
AIB are proud supporters of the Transport & Logistics sector. In this year's Outlook report we take a look at the significant growth in Online Retail which is fuelling increased demand for logistics services and the need for high quality logistics capacity in the market.
Outlook: Pubs (February 2018)
AIB, the leading provider of finance to Ireland’s pub sector has reported a 6% growth in the sector for 2017. AIB has released its 2018 Pubs Outlook, which also finds a 6% increase in spending by UK visitors to Irish pubs in the 12 months to the end of October 2017, despite a decline in visitor numbers from the UK.
Outlook: Transport & Logistics (May 2017)
With over 3,700 licenced haulage operators through Ireland, employing over 50,000 staff between them, the Irish road haulage sector plays a vital, but often overlooked, role within the Irish economy. We look at some of the key challenges and opportunities facing the sector.
Growth and governance in the non-profit sector (March 2017)
The results of the Nonprofit Survey commissioned by AIB and Irish Life and carried out by PwC, points to strong optimism about the future. A clear majority of organisations expect to grow rather than reduce or merely maintain current service levels while many expect to offer a wider variety of services or to expand their geographic coverage.
Outlook: Pharmacy Update (May 2015)
With over 1,800 pharmacies in Ireland, the majority operate on a similar business model with very few standing out from the crowd in the way they run their business. Pharmacists now need to look to new business models and develop a range of customer-focused services.
Outlook: Beef (May 2015)
Beef farming is the dominant enterprise on Irish farms, with over 95,000 farms having some element of a beef business. The sector is, however, undoubtedly the most diverse within Irish agriculture, with major differences between farms in terms of system, scale, intensification, efficiency, off-farm employment and dependence on direct payments.
Outlook: Nonprofit (December 2014)
The Irish non-profit sector is a diverse ecosystem of charities, advocacy groups, NGOs, and community and voluntary organisations that plays an important role in the social, cultural and economic fabric of Irish society. With a combined turnover in excess of €6 billion a year, assets of €3.5 billion, over 100,000 employees and 560,000 volunteers, the sector has faced some stiff challenges in recent years.
Outlook: Long Term Care (October 2014)
The number of people aged 65+ in Ireland is expected to increase by 38% over the next seven years, and this will place unprecedented demand on the health service and the level of care and support provided to older people. The long term care sector is facing stiff challenges if the expected demand for beds by 2021 is to be met
Outlook: Residential Property (May 2014)
With the Irish residential property sector now entering a period of growth and consumer sentiment improving, a number of factors are conspiring to inhibit the supply of much-needed new housing stock, particularly in key urban areas.
See also - Property Watch Quarterly Reports
Outlook: Energy Efficiency for Business (December 2013)
Energy costs have a significant impact on every SME in Ireland. Reducing energy consumption saves SMEs money, and those savings go straight to the bottom line. This report analyses energy consumption, the understanding of energy bills and the appetite to undertake energy initiatives to reduce costs.
Outlook: Licensed Trade (August 2013)
There is a degree of polarisation emerging in Ireland between pubs that are responding effectively to the recession and those that continue to experience decline. However, research – carried out by Amárach Research on behalf of AIB – also shows varying levels of optimism within the sector.