- by Patrick Cooney on 11/05/2021
The first three months of the year have seen a significant increase in 'necessity-led entrepreneurship' across the retail and wholesale sectors, according to the latest figures from CRIFVision-net. The quarterly figures published today reveal an 88% (+438) year-on-year increase in retail trade and wholesale start-ups, suggesting that the continued Covid-19 public health restrictions and resulting job losses, may have compelled more individuals to start their own businesses in response to the last 12 months of adversity.
The data shows a total of 6,353 new company start-ups were registered in Q1 2021, marking an 8% increase when compared to the same period last year. During this period, company insolvencies were also up by 7% (Q1 2021 vs Q1 2020).
Other sectors to see double-digit year-on-year start-up growth include manufacturing (87%), motoring (41%), transport, storage and communications (33%) and health and social work (11%). Meanwhile real estate (+9%), finance (+8%) and IT (+8%) also demonstrated YoY growth.
The quarterly data suggests the hospitality and construction sectors continue to feel the impact of Government Covid restrictions. According to the data:
The hospitality sector saw a 13% decrease in company start-ups compared to 2020.
Construction recorded a six per cent decrease in start-ups and experienced a 25% increase in insolvencies during the same period.
A total of 16 counties in the Republic of Ireland experienced a YoY improvement in new company registrations for Q1 this year. Amongst these counties, Sligo (+68%), Carlow (+51%) and Westmeath (+38%) recorded the highest percentage growth.
Dublin accounted for the largest number of new start-ups in Q1, recording a total of 2,918 registrations. This marks a 9% YoY increase for the county. Cork saw a total of 644 new start-ups (+16%), Galway recorded 249 (+17%) and Limerick recorded 192 new start-ups (+8%).
Commenting on the Q1 figures, Christine Cullen, Managing Director of CRIFVision-net, said:
Twelve months on from the first Covid lockdown and the Irish economy continues to demonstrate its resilience, despite the ongoing Covid-19 public health restrictions and uncertainty. Overall, an eight per cent growth in new company start-ups suggests an underlying confidence in the fundamentals of the Irish economy and last week's Department of Finance forecast of a 4.5 per cent growth in GDP this year, and a five per cent rise next year, further supports this.
What is evident from our latest data, is that industries such as the hospitality and construction sectors, continue to bear the brunt of the Covid-19 public health restrictions. However, recent economic and operational challenges in other sectors, combined with a 'nothing to lose' mentality may have given rise to a new wave of necessity-led entrepreneurship. This is particularly evident in relation to the retail trade and wholesaling industries who have experienced a notable increase in company start-ups over the last three months, despite being subject to ongoing restrictions. The growth across this sector, and many others in the first quarter of the year, gives plenty of reason for optimism in the year ahead. However, economic prospects for Q2 and beyond continue to hinge on the successful roll out of the vaccine programme and the assumption of an easing of Covid restrictions in parallel.
Despite the continued economic adversity felt across many sectors, the fundamentals of the Irish economy remain strong and business owners appear quietly confident of strong growth in 2021.
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