Government must prioritise cost reduction to assist job creation.
At the announcement of the monthly unemployment figures released by the CSO, today (3rd August) ISME, theIrish Small and Medium Enterprises Association, warned of the static rate of unemployment. The Association called for an increased focus on the reduction of business costs to allow SMEs the capacity to employ more.
The CSO figures confirm the standardised unemployment rate has remained at 7.8% for the third month, with 169,100 people still signing on the dole. More worrying is the increase, for the second month, in youth unemployment, now up to 16%.
Commenting on the figures ISME, CEO, Mark Fielding said, “Today’s figures confirm that job creation has stalled due to business cost increases. The cornerstone of productivity and competitiveness is cost control and it is time that the Government became more involved in tackling cost-creep across the business sector”.
“As an open economy we are dependent on exporting and therefore exposed to exchange rate fluctuations and the economic conditions of our trading partners. While we can do little to influence these, our competitiveness can be addressed by attention to input costs at home.”
According to the NCC, Ireland is a high cost economy. We only have to look at the massive insurance increases being foisted on business to see that the Government have turned a blind eye to the insurance providers. The concern is that a similar stance will be taken on wage demands. The recent increasing pressure on labour costs, if acceded to, will negatively affect our competitive position and must be resisted.
The Association called on Government to:
Stand firm on all public sector pay demands and any resultant industrial action.
Reduce government influenced business costs to below the EU average.
Target capital investment in job rich infrastructure.
Encourage entrepreneurs through the tax system.
Ensure real measurable access to credit for viable SMEs.
Outsource more state sector services to SMEs.
Reform the social welfare system to make it more profitable to work.
Attack the scourge of ever-increasing black economy activity.
“The recent ISME survey on Government Satisfaction for the second quarter of 2016, shows that this administration scores very badly on business cost curtailment. Today’s figures are a warning that much more must be done”, concluded Fielding.