Over two-thirds of Irish business chiefs predict flat or shrinking economy in 2024

More than two-thirds (68 per cent) of senior business leaders in Ireland believe that the Irish economy will remain flat or decline this year, according to a new survey.

A survey of more than 700 business leaders by law firm Mason Hayes & Curran found that almost a quarter (23 per cent) believe the Irish economy will decline this year, while close to half (45 per cent) believe it will see no growth.

Some 82 per cent said they are steering clear of mergers and acquisitions activity this year, while 60 per cent believe that the Organisation for Economic Co-operation and Development’s 15 per cent corporate tax rate will negatively affect the economy.

While 61 per cent said they plan to increase spending on digital transformation, just 14 per cent expect to increase resources in office space this year, “reflecting the change in work patterns post-pandemic”.

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Among respondents, 43 per cent predicted that their weekly office occupancy rates would be between 25-50 per cent this year, 39 per cent predicted office occupancy rates of 50-75 per cent and one in 10 estimated office occupancy would be below 25 per cent.

Three-quarters of business leaders said they expect the price per square metre for commercial real estate to be lower by the end of 2024.

Primary concerns for business leaders this year are staff recruitment and retention (27 per cent), keeping pace with new regulations (26 per cent) and business costs (24 per cent).

In terms of regulatory compliance, the greatest hurdles are the volume of regulatory change (33 per cent), the complexity of the requirements (23 per cent), and resource constraints (23 per cent).

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Will Carmody, managing partner at Mason Hayes & Curran, said that businesses are “increasingly required to adapt their operations, reporting, and strategic planning to meet evolving regulatory standards. It is more important than ever for organisations to ensure they are informed and well-advised in this dynamic legal landscape.”

The incoming Corporate Sustainability Reporting Directive and the Central Bank (Individual Accountability Framework) Amendment Act 2022 are expected to have the greatest impact on Irish businesses this year, as less than half of respondents said they felt well prepared for either piece of legislation.

On the topic of sustainability, 89 per cent of businesses said that ESG (environmental, social and corporate governance) factors are influencing their business planning and decision making to a significant or moderate extent.

The survey found that business leaders are also conscious of the impact of the EU Artificial Intelligence Act, expected to be passed into law this year. Some 42 per cent said they believed the law would lead to increased productivity, although 32 per cent said they feared greater risk exposure.

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