CONSTRUCTION INDUSTRY NOW ACCOUNTS FOR LESS THAN 8% OF ECONOMIC OUTPUT - The annual review of the construction industry by consultants Davis Langdon predicts further declines in activity both this year and next year and little or now growth for a couple of years thereafter. This year it estimates the total output from the sector at €8.9 billion. This is down from nearly €11 billion last year and €38 billion at its peak in 2006/2007. Five years ago the construction industry accounted for just over a quarter of Ireland's entire economic output. This year it will come in just under 8%.
Paul Mitchell, a director of Davis Langdon Ireland, says that compared to other euro zone nations, we are spending less than half than they are on construction projects. He says that funding is clearly a big issue and suggests the Government look to alternative forms of funding, such as using pension funds. He says that ESRI research shows that for every €1 billion invested in construction, the state gets back €450m and if there is no investment it loses out on tax revenues while it also faces higher social welfare spending.
Mr Mitchell says the country continues to have an infrastructure deficit and money needs to be spent in this area. He says that capital spending is an easy target in Budget cuts as Ministers are more wary of cutting current spending due to the fear of strikes. However, he predicts that it will be cut in future budgets.
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MORNING BRIEFS - The construction industry now accounts for just under 8% of economic output. ISME, the small and medium firms association, tells us today the black economy now accounts for twice that amount - or €25 billion in cold hard cash. The term 'black economy' covers everything from smuggling to undeclared income or the 'nixer culture' as ISME refers to it.
*** Business lobby group IBEC and its sister organisation, the Small Firms Association, publish business sentiment surveys this morning. Key findings from the IBEC data is that the number of firms intending to hire new staff within the next three months nearly doubled to over 20% over the three months between April and June, when compared to the same period last year. The SFA has a similar outcome with 23% of respondents to its survey expecting to recruit temporary staff in the next three months. That survey shows the number of employers planning to hire new staff is higher than the number preparing to let go staff for the first time since 2009.
*** Microsoft, together with the BBC, BT and Sky, is trialing new technology to more efficiently deliver television signals over wireless internet technology to mobile phones. It has already built experimental networks to do this in the US and is now trying to replicate the model in the UK with a view to persuading other European countries to come on board.
*** On the currency markets, the euro is worth $1.4124 and 88.65 pence sterling.
