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A NO-DEAL BREXIT would deliver a massive jobs hit in Ireland, the Central Bank has warned.
In its latest quarterly bulletin, the bank has said economic growth in Ireland is now expected to be 4.9% this year and 4.1% by 2020.
The unemployment rate meanwhile is projected to decline from 4.7% this year to 4.5% next year.
Those central forecasts, however, are based on a deal on Brexit being reached and a transition period coming into effect until the end of 2020.
Given the unprecedented nature of Brexit, and the uncertainties in the international trading environment, there is considerable uncertainty around potential outcomes, the regulator noted.
In the event of a no-deal Brexit from the end of October this year, Central Bank estimates suggest that economic growth would be reduced to 0.7% next year, with around 34,000 fewer jobs by the end of 2020 compared to the central forecast.
In the event that a disorderly, no-deal Brexit can be avoided, underlying economic activity is expected to perform strongly in 2019 and 2020.
The Central Bank warned that, given the already cyclically advanced stage of the economy, there is a material risk that continued strong expansion could give rise to overheating and generate sustained upward wage pressures.
“In the event that the disruption from a no-deal Brexit is avoided, there is a risk of overheating occurring in the Irish economy given that output is now at or close to full capacity,” Central Bank director of economics and statistics Mark Cassidy said.
“The uncertainties around Brexit and managing the risk of overheating increase both the challenge and importance of charting the appropriate fiscal policy path,” he said.
If a disorderly Brexit can be avoided, the underlying outlook and, in particular, the risk of overheating, emphasises the importance of a more ambitious improvement in the fiscal position.
On the other hand, if a disorderly Brexit were to occur, there would be a material deterioration in the public finances and the fiscal environment would be significantly more challenging.
In this case, Cassidy said, “there may be need to provide targeted support to the parts of the economy that are most affected”.
Business uncertainty
Meanwhile, the percentages of SMEs in the Republic of Ireland being negatively impacted due to economic and political uncertainty surrounding Brexit has doubled from 21% to 42% in the past year.
That’s according to the AIB Brexit Sentiment Index for the second quarter of the year.
By comparison, 48% of SMEs in Northern Ireland admitted their businesses were now being negatively impacted by Brexit.
Meanwhile, the delays implementing Brexit are also continuing to weigh heavily on overall sentiment, with 37% of SMEs in the Republic and 40% in the North claiming the delay is having a negative impact on their business.
While just 1% of SMEs in the Republic have let go staff as a result of Brexit, 11% have postponed plans to hire new staff, according to the Index.
In Northern Ireland, meanwhile, 3% of SMEs have already let go staff while 17% have postponed plans to add to their existing workforce.
The research also shows that 40% of SMEs in the Republic that had planned to expand or invest in their businesses have since cancelled or postponed these plans while another 16% are reviewing them.
Similarly, in the North, 38% of SMEs have either postponed or cancelled investment plans while 10% are currently reviewing them.
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Very sad. I’ve often visited this Camphill community centre and it was a beautiful place for residents to live with land, animals, gardens and buildings. Lots of young Europeans volunteering years of their lives to provide an alternative option for living to people who would otherwise spend their lives in dull institutions having their senses dulled by chemical restraint.
Don’t think transferring it to the HSE will make it any better, with their record on mental health facilities .
I too have visited Camphill Ballytobin, and was really impressed by the interaction between staff and residents. What better way to live for people with disabilities, than being to assist in food production and crafting, and being at one with nature, while being allowed to progress at their own pace. Far better than being locked up in an institution. Let’s hope this isn’t another bureaucratic exercise by Hiqua! The HSE’s past record in looking after those with disabilities, leaves a lot to be desired.
The Camphill model was such a nice one. This is very sad to read indeed.
Hopefully these services can be brought up to an appropriate standard and continue to operate . We need to protect the most vulnerable as are many of the people attending these services .
Staff and managers running these services have a responsibility too plus resources from Government and HSE let’s hope it’s a move for better in relation to the lives of the people using the service.
I just cannot trust this government or the welfare of the disadvantaged it’s responsible for.
Budgets come before welfare. They seem to be able to find reasons to, in this case, stop a well run, people orientated, facility for the disabled, and hand it over to the HSE, an organisation that’s nothing else but a gravy train for the execs and managers.
Only time will tell.
Does anyone know why volunteers are no longer allowed because HSE are taking over? I can’t understand why HIQA keep handing over these centres to the HSE when there is a clear record of HSE running such places into the ground, feel so distressed reading this.
have your say