CEO Update: Shoring up our economic resilience
Dear member,
As we approach Budget 2026, it is important to frame it against the backdrop of recent trade volatility affecting the global economy. Despite these international pressures, Ireland continues to demonstrate significant resilience. We are, however, acutely aware of how important the final quarter of the year is in withstanding the external challenges impacting many other economies.
The resilience of our economy was presented in Ibec’s latest Economic Outlook, which forecasts robust domestic demand growth of 3.0% in 2025 and 2.6% in 2026. You can listen to analysis from Ibec’s Economics team here
This resilience is also reflected in our most recent CEO Pulse Survey, conducted in August, which shows renewed confidence among business leaders as they emerge from the instability of the first nine months of the year. CEO feedback revealed that those with a positive outlook for the next six months more than doubled, rising from 15% in March to 34% today. Similarly, the share of leaders with a negative outlook fell from 41% to 28%. While optimism is growing, companies remain cautious and continue to review spending plans and plan for supply chain risks in the context of ongoing global uncertainty.
Our analysis also anticipates a softening in the labour market, including slower hiring as reported in member surveys. While employment growth has been remarkable, it is expected to slow to below 2% next year. Further details on current and forecasted trends can be found in our recent Pay and Resourcing Forecast Report 2025.
With all of the above in mind, our message on the Budget is clear: fiscal management must restore a sustainable balance, but decisions should prioritise future focused investments in areas such as infrastructure, innovation, and skills over short term spending increases or tax cuts. This is critical to meeting the changing needs of our economy and addressing demographic shifts. Quite simply, while we must proceed with caution, we cannot afford to slow investment in the key drivers of growth.
Looking ahead, Ireland’s Presidency of the Council of the EU in the second half of 2026 presents a crucial opportunity. It will allow Ireland to highlight progress and champion key EU priorities – issues central to Irish business such as security, openness, and deeper savings and investment integration. We are looking for your input to directly inform our strategy to influence government policy and to build on our ongoing Competitive Business, Competitive Europe campaign. Please contact my colleagues in our EU and International Affairs team for more information at ibec.europe@ibec.ie
Regards,
Danny McCoy,
CEO,
Ibec
