Unsustainable wage promises from re-election chasing politicians acting as a brake on domestic economy.
Recovery still not being felt in rural areas.
ISME, Tuesday 28th April 2015
ISME, the Irish Small & Medium Enterprise Association, expressed concern at the slow rate of increase and the continuing erosion of margins in the Retail Sales figures for March, released today (28th April) by CSO. The Association warned Government that it’s pre-occupation with the export based economy leaves the domestic sector to suffer unnecessarily. A dual focus on both areas is needed to ensure sustainable growth.
Retail sales figures showed an annual increase of 9.2% in volume and 5.7% in value. When the motor trade is excluded, sales were 4.7% higher in volume and 1.2% higher in value.
According to ISME CEO, Mark Fielding, “It is certainly true that building a buoyant economy will require strong exports but the domestic market remains slow-moving and needs a stimulus package. Government is allowing itself to be distracted by the big news items of re-election, FDI investment and promised jobs announcements and is forgetting that domestic facing SMEs and retailers in particular need their help.”
“There has been much talk in recent months about town centre revitalization, with an Oireachtas report published but Government seems disinterested in actually pursuing the recommendations made. The recovery is little more than a notional concept outside of Dublin at the moment and small business owners are waiting for Government to finally act”.
The main issues facing retailers are:
Very low margins, as evidenced by the CSO figures.
Excessive retail business costs, commercial rates and development charges.
The surge in Shadow Economy.
Town centre revitalisation.
Social welfare anomalies and inflexibilities.
Insufficient bank credit availability for retail SMEs.
Sector specific training.
“Increased uncertainty concerning wage costs, particularly the National Minimum Wage and the general cost of doing business is slowing the already fragile recovery. The continuous loose talk from Government ministers on wage increases is acting as a brake on retail development plans and should stop”, concluded Fielding.