Morning business news - July 8Monday 08 July 2013 14.44
IBEC URGES SLOWDOWN OF AUSTERITY IN OCTOBER BUDGET - The Government can abandon plans for tax hikes in the upcoming budget and still hit deficit reduction targets, says the Irish business and employers confederation. In its pre-budget submission, IBEC has urged the Government to take no more than €2.6 billion out in 2014 against the target of €3.1 billion.
IBEC's chief economist Fergal O'Brien says that the country can now look beyond the IMF/EU bailout and has choices for the first time in many years. The economist says that while there have been fundamental improvements in the economy, including lower unemployment, consumer confidence remains weak. Despite the recent economic progress, the country's recovery remains fragile and in order to protect existing jobs and create new jobs, employment costs should not rise, he cautions. Mr O'Brien says the ending of austerity should be marked in recognition of the country's out-performance of our economic targets.
IBEC also wants the reduced VAT rate in the hospitality sector to be retained in the October budget, while it wants an improved research and development tax credit scheme. Mr O'Brien points out that other countries, including the UK, are improving their tax offering to business to remain attractive to foreign investment. He also urges more schemes to encourage the country's entrepreneurs. ''The Government needs to think how it can get buoyancy back in to the economy,'' he states.
MORNING BRIEFS - Activity in the construction sector was lower in June than in May - marking the 73rd consecutive month in which activity levels have fallen. But the drop was at a lower pace than during the previous month according to the Ulster Bank Purchasing Managers index. New order levels during June were at the highest level in over a year and actually came very close to recording a month-on-month increase. The monthly survey of purchasing managers suggests their confidence level is now at its highest since 2007 but business levels still yet to match that optimism.
*** Mexican telecoms billionaire Carlos Slim has spent $40m to buy around a 10% stake in the music recognition application Shazam. Shazam is a mobile phone app that you flick on when you are out and about and hear a song you like but don't recognise. The app will tell you what it is and offer you the option of paying to download it. London-based Shazam is planning an initial public offering of its shares next year. It hopes to push its value past $1 billion by that stage which would more than double Mr Slim's money if that comes to pass.
*** Two separate reports this morning point to a rise in job vacancies being advertised. Recruitment consultant Morgan McKinley's Irish Employment Monitor records a 10% increase in professional job vacancies over the three months to the end of June compared with the same period last year. At the same time the number of professionals looking for work has fallen by 17%. It attributes this to a still weak economic climate which is making those professionals in employment more wary about seeking to move.
Irishjobs.ie, meanwhile, says there has been a 7% increase in the number of jobs advertised across the main Irish recruitment websites -(including its own - between April and June over the previous three month period from January to March. Year-on-year, though, it should be noted the total jobs advertised figure is lower in the second quarter of this year than it was at the same point in 2012.