With falling unemployment, Ibec warns of post-election instability risk

Ibec, the group that represents Irish business, today said that the latest employment figures from the CSO, which show that Irish business created a further 50,000 new jobs during 2015, were a fitting and timely reminder of the tangible impact of economic recovery. However, the group said businesses were increasingly concerned that post-election instability could impact the pace of recovery.

Ibec CEO Danny McCoy said: “Irish business can create a further 60,000 new jobs in 2016, but hiring plans could be threatened if the election results in an unstable or anti-enterprise government. Business will deliver more jobs over the coming years, but the conditions must be right. Sensible economic and enterprise policy is needed to support growth and job creation.”

Ibec pointed to other European countries, such as Greece or more recently Portugal, where the failure to put in place stable pro-enterprise government has had a very direct and damaging impact on their economies. Ibec said its 7500 members were increasingly concerned that post-election political instability could undermine confidence in Ireland’s recovery internationally, raise borrowing costs and damage job creation.

Ibec CEO Danny McCoy said: “Uncertainty is the enemy of business. It makes it more difficult for companies to plan ahead, make investment decisions and create jobs. After some very difficult years, we are now rapidly reducing unemployment and generating the tax revenue needed to support investment in public services and vital infrastructure. It is vital that this positive trend continues.

“Recent political instability and a move towards the radical left in Portugal has had a direct and significant impact on the country’s cost of borrowing. Last October, 10 year bond yields in Portugal were 1.2% higher than they were in Ireland, last week they were 3.1% higher. In contrast, Ireland continues to enjoy record low interest rates on its borrowing, at a time when we need ambitious public investment.”