We all know that 2020 was a tough year for the Irish economy but we can see that our local industries remain strong and robust. According to the latest figures from CRIFVision, the number of business registrations has grown by the end of the year. Although 2020 has the lowest registration record since 2016, the economy has proven to be more resilient in 2020 than in the 2008 recession.
A total of 21,924 new businesses were registered in 2020, which was 4% lower than last year. This may seem alarming, but it looks much more stable than the 22% decrease in 2007-2008. The decline was mainly due to the fact that only 1074 new companies were registered during the first lockdown in 2020, which was the lowest since December 2012. Instead, we see the company owners postponing their business ventures for the improved economy. The overall insolvencies in 2020 is 10.7% lower compared to 2019, at a number of 570 insolvencies, but this can be widely attributed to the court closures during the lockdown.
In Q4 of 2020, we saw a great improvement in the number of business registration. There were about 6,583 new companies reported by the end of the year, which is 20% higher from the Q3 and 23% from Q4 of 2019. Amongst the various industries, fishery experienced the worst decline in new start-ups, followed by leasing and hospitality. On the other hand, the legal and accounting sector contributed the most to new business start-ups in 2020.
It cannot be denied that government support for SMEs is the key to maintaining entrepreneurial vitality, however a sustainable environment is also necessary to be expedited to enable the economy society function back to normal post COVID-19 restrictions.
Irish Business and Employers Confederation (IBEC) conducted a survey by demonstrating that local businesses may be transformed in the near future. The Irish CEOs were asked by this survey about what they thought and outlook for 2021. The survey reveals that almost two-thirds (65%) of the CEOs believe that their business model is going to change permanently. Other than that, 72% said it would be a massive obstacle to work in the offices and 73% said it would impede collaboration and innovation.
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