BDO Optimism Index 2020 Q2
17 August 2020
BDO’s Optimism Index is a continuous survey carried out for the last eight years, tracking business performance and the views of business leaders across Ireland. Results of the survey show the effects of COVID-19 on business activity, employment, pricing, profits and optimism.
Business optimism during the quarter was at its lowest level since the first Optimism Index was commissioned in 2012. The research highlights that the last quarter was extremely challenging for businesses across Ireland, with operational profits taking a noticeable fall and 75% of businesses reporting lower levels of activity than during the same period last year. The survey also shows that the business environment in Dublin was marginally more challenging; however, optimism levels among businesses is equally pessimistic outside the capital for the coming quarter.
The survey indicates clear pressure on employers with 34% of companies reporting lower levels of employment than during the same quarter last year. A number of businesses surveyed are also cutting prices to stimulate demand, with 18% reporting that they charged lower prices for the most recent quarter compared to the same period last year.
Brexit remains another concern, with just under half of businesses claiming that it will negatively impact their business - the lowest level since 2017.
State-funded supports have clearly helped to sustain many small and medium enterprises in the last quarter; however, only one in five businesses have sought professional advice about either reopening or restructuring in response to the pandemic. With the impact of Covid-19 set to continue in the coming quarter, it's important that businesses take action and try to limit the damage to ensure they remain viable in the long term.
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