• Current students
      • Student centre
        Enrol on a course/exam
        My enrolments
        Exam results
        Mock exams
        Learning Hub data privacy policy
      • Course information
        Students FAQs
        Student induction
        Course enrolment information
        F2f student events
        Key dates
        Book distribution
        Timetables
        FAE elective information
      • Exams
        CAP1 exam
        E-assessment information
        CAP2 exam
        FAE exam
        Access support/reasonable accommodation
        Extenuating circumstances
        Timetables for exams & interim assessments
        Interim assessments past papers & E-Assessment mock solutions
        Committee reports & sample papers
        Information and appeals scheme
        JIEB: NI Insolvency Qualification
      • CA Diary resources
        Mentors: Getting started on the CA Diary
        CA Diary for Flexible Route FAQs
      • Admission to membership
        Joining as a reciprocal member
        Admission to Membership Ceremonies
        Admissions FAQs
      • Support & services
        Recruitment to and transferring of training contracts
        CASSI
        Student supports and wellbeing
        Audit qualification
        Diversity and Inclusion Committee
    • Students

      View all the services available for students of the Institute

      Read More
  • Becoming a student
      • About Chartered Accountancy
        The Chartered difference
        What do Chartered Accountants do?
        5 reasons to become a Chartered Accountant
        Student benefits
        School Bootcamp
        Third Level Hub
        Study in Northern Ireland
        Events
        Blogs
        About our course
        Member testimonials 2022
        Become a Chartered Accountant podcast series
      • Entry routes
        College
        Working
        Accounting Technicians
        School leavers
        Member of another body
        International student
        Flexible Route
        Training Contract
      • Course description
        CAP1
        CAP2
        FAE
        Our education offering
      • Apply
        How to apply
        Exemptions guide
        Fees & payment options
        External students
      • Training vacancies
        Training vacancies search
        Training firms list
        Large training firms
        Milkround
        Recruitment to and transferring of training contract
        Interview preparation and advice
        The rewards on qualification
        Tailoring your CV for each application
        Securing a trainee Chartered Accountant role
      • Support & services
        Becoming a student FAQs
        Who to contact for employers
        Register for a school visit
    • Becoming a
      student

      Study with us

      Read More
  • Members
      • Members Hub
        My account
        Member subscriptions
        Newly admitted members
        Annual returns
        Application forms
        CPD/events
        Member services A-Z
        District societies
        Professional Standards
        Young Professionals
        Careers development
        Recruitment service
        Diversity and Inclusion Committee
      • Members in practice
        Going into practice
        Managing your practice FAQs
        Practice compliance FAQs
        Toolkits and resources
        Audit FAQs
        Other client services
        Practice Consulting services
        What's new
      • In business
        Networking and special interest groups
        Articles
      • Overseas members
        Home
        Key supports
        Tax for returning Irish members
        Networks and people
      • Public sector
        Public sector news
        Public sector presentations
      • Member benefits
        Member benefits
      • Support & services
        Letters of good standing form
        Member FAQs
        AML confidential disclosure form
        Institute Technical content
        TaxSource Total
        The Educational Requirements for the Audit Qualification
        Pocket diaries
        Thrive Hub
    • Members

      View member services

      Read More
  • Employers
      • Training organisations
        Authorise to train
        Training in business
        Manage my students
        Incentive Scheme
        Recruitment to and transferring of training contracts
        Securing and retaining the best talent
        Tips on writing a job specification
      • Training
        In-house training
        Training tickets
      • Recruitment services
        Hire a qualified Chartered Accountant
        Hire a trainee student
      • Non executive directors recruitment service
      • Support & services
        Hire members: log a job vacancy
        Firm/employers FAQs
        Training ticket FAQs
        Authorisations
        Hire a room
        Who to contact for employers
    • Employers

      Services to support your business

      Read More
☰
  • The Institute
☰
  • Home
  • Articles
  • Students
  • Advertise
  • Subscribe
  • Archive
  • Podcasts
  • Contact us
Search
View Cart 0 Item
  • Home/
  • Accountancy Ireland/
  • Home/
  • AI articles

Six key activities to expect from the economy in 2023

Jan 06, 2023

After the uncertainties of the last few years, we’ve learned to approach a new year with caution. However, Graham Reid has given us six reasons to be hopeful about Ireland’s economy in 2023

As we look into the new year, Ireland's economy is relatively well-positioned to deal with the turbulent economic conditions that are persevering from 2022. Strong multinational and technology sectors, robust employment levels, a highly skilled workforce and consistently favourable exchequer returns will give policymakers greater flexibility to respond to the challenges that may lie ahead.

Here are six things we expect to see in the economy in 2023.

1. Lower spending levels due to sustained inflation

Rising costs across the Irish and global economies are eroding consumer and business confidence.

Consumer sentiment in Ireland tumbled in the latter half of 2022, and EY's Future Consumer Index found that 52 percent of global consumers are spending less on non-essential goods.

Rising consumer and business prices are expected to persist into 2023, which is likely to further reduce real disposable incomes, increase interest rates, lower consumer demand, impact business performance and increase costs for investment and capital programmes for both business and Government. These effects will slow activity levels and feed into lower economic growth in 2023.

2. Ireland to remain resilient

Although not immune from the turbulence in the global economy, as a small and open economy, Ireland should be somewhat better placed to deal with a downturn due to a strong combination of factors, including the presence of multinationals, continued inward investment, robust Irish businesses and government investment.

Ireland's sectoral focus on pharma, food, technology and finance and the presence of overseas investment and companies has been a success story of the last two decades. Although the risks are well documented, it has significantly boosted Ireland's exchequer position.

Most importantly, Ireland has a vibrant and growing indigenous business sector that includes large domestic and outbound multinationals and a thriving and expanding entrepreneurial cadre. These businesses are essential to the economy's vitality, providing critical employment and economic activity, fostering entrepreneurship, providing jobs and diversifying our export markets post-Brexit.

Ireland has the benefit of a highly educated and skilled workforce and is now the sole English-speaking, common-law country within the European Union (EU).

3. Policy focus on energy costs and security of supply

As energy costs spiralled throughout 2022, the affordability and reliability of supply issues dominated the political agenda.

The war in Ukraine and rapidly rising energy prices brought the over-reliance on other geographies, and single sources of energy to the fore as countries acted swiftly to expand locations and diversify supply.

The government's role in subsidising costs also came into question as it was deemed necessary to provide households with energy credits to tackle higher bills.

The topic of supply diversification, energy price caps, and the effects of such interventions will span into 2023 and beyond.

4. Investment in critical infrastructure to retain competitiveness

Maintaining competitiveness is essential for Ireland's continued growth story, particularly in attracting investment and talent. For businesses to continue to invest and prosper in Ireland, they will need to attract top global talent to work, particularly when there is a tight labour market and record employment levels.

A buoyant, functioning housing market where people can find suitable accommodation is essential for companies. We know that housing availability can significantly impact our global competitiveness.

This year will see continued investment in improving infrastructure capacity in housing and ensuring adequate supporting infrastructure such as water and energy to accommodate our expanding population. Getting this right will facilitate further economic and population growth while supporting business investment and entrepreneurship.

5. Disrupted transition to net zero

The transition to a green economy has been disrupted due to the ongoing energy and cost of living crises.

Businesses and consumers are refocusing on costs, and there is less appetite to spend more on greener alternatives. However, policy measures to encourage climate-friendly activities and behaviours, such as carbon taxes, become more controversial if they are seen to feed further price increases.

New EU regulations such as the Corporate Sustainability Reporting Directive (CSRD) will emphasise transparent corporate reporting and set a higher standard on environmental, social and governance (ESG) practices.

Government policy in 2023 will have to carefully balance the need for decisive action on climate action and the mounting costs pressures on households.

6. Accelerated digitalisation agenda

Digitalisation is a global trend we can expect to gather further pace in 2023.

We will see more data-centricity, tech transformations and the rise in the use of artificial intelligence to solve business issues, manage costs, help with sustainability challenges and deliver long-term value.

The Irish Government's National Digital Strategy (NDS), launched in 2022, aims to "drive a step-change in the digitalisation of businesses, in particular, SMEs, to sustain Ireland's attractiveness as a location for leading digital enterprises." Taking advantage of the presence of a strong tech sector in Ireland, and becoming a leader in digitalisation and innovation, will put us on a solid global footing for continued investment and economic growth in the years ahead.

Graham Reid is Partner and Head of Markets at EY Ireland.

The latest news to your inbox

Useful links

  • Current students
  • Becoming a student
  • Knowledge centre
  • Shop
  • District societies

Get in touch

Dublin HQ

Chartered Accountants
House, 47-49 Pearse St,
Dublin 2, Ireland

TEL: +353 1 637 7200
Belfast HQ

The Linenhall
32-38 Linenhall Street, Belfast
Antrim BT2 8BG, United Kingdom.

TEL: +44 28 9043 5840

Connect with us

CAW Footer Logo-min
GAA Footer Logo-min
CARB Footer Logo-min
CCAB-I Footer Logo-min

© Copyright Chartered Accountants Ireland 2020. All Rights Reserved.

☰
  • Terms & conditions
  • Privacy statement
  • Event privacy notice
LOADING...

Please wait while the page loads.