Aon’s Decision Maker Pulse survey reveals the main risks facing Irish companies and the difficult decisions business leaders must make to successfully navigate economic headwinds. The Decision Maker Pulse, undertaken by iReach on behalf of Aon, surveyed 228 senior business leaders from companies employing more than 250 employees across Ireland between October and November 2022.
Main Economic Risks Facing Irish Businesses
Aon’s Decision Maker Pulse found that economic slowdown is seen as the top risk facing companies, followed by inflation (26 percent) and the failure to attract or retain top talent (16 percent).
52 percent of leaders believe that rising energy prices will hinder their company’s ability to grow within the next 6 months. The growing unease over high inflation is also impacting upon business sentiment. Over half (53 percent) expect low economic growth while 41 percent expect the Irish economy to enter recession in the next six months. Irish leaders appear to be more optimistic than their global counterparts, with 79 percent of leaders globally expecting a recession this year, according to a separate survey carried out by Aon.
Difficult Business Decisions Being Considered
When considering the steps that will be needed to mitigate the impact of inflation on their organisation, half of businesses in Ireland (50 percent) are considering decreasing day-to-day spending in order to mitigate the impact of inflation on their finances.
Almost a third (32 percent) say they will consider reducing headcount. 27 percent are looking to optimise supply chains and 26 percent will look to digital technology to increase efficiencies.
Challenges of an Economy at Full Employment
Despite short-term economic challenges, Ireland’s labour market appears to remain near full employment. According to Aon’s Business Decision Maker Pulse, 52 percent of senior business leaders say their company is experiencing difficulty in attracting and retaining talent. 30 percent of Irish businesses have enhanced their employee benefits and rewards packages in the past six months to attract and retain top talent.
Importance of Culture in Attracting & Retaining Talent
The survey also points to the growing importance placed on company culture by leaders looking to incentivise new talent into their organisation and keep their existing employees engaged. Almost three in four (71 percent) now see company culture as more critical in attracting and retaining talent than a competitive salary or employee benefits.
Commenting on the results, Rachael Ingle, CEO, Aon Ireland, said: “As Aon’s Decision Maker Pulse survey highlights, inflation and rising energy costs are having a tangible impact on Irish businesses and their plans for the coming months. Many leaders are now actively considering ways in which they can manage costs while continuing to build a workforce that attracts the very best talent who can help foster innovation. But with the increasing likelihood of a global recession, it is clear that economic risk is becoming the driving factor in how Irish leaders make business decisions over the coming months.
“That’s why it is vital that leaders focus on protecting their organisation’s resilience and find growth opportunities in the face of heightened volatility. Businesses will need to be agile in the face of current uncertainty and look at ways in which they can enhance their competitiveness. Despite the economic headwinds we now face, Irish businesses should not lose sight of the need to invest in the future and to continue advancing their sustainability journey. Aon Ireland is helping to give Irish businesses the clarity and confidence to make better decisions to protect their organisation this winter and unlock new growth opportunities in the months ahead.”
Making Better Decisions
Strong, prepared leaders are essential to building that resilience and turning economic headwinds into positive tailwinds. Leaders can start preparing today by:
- Embracing economic volatility and look at ways to mitigate those risks
- Understanding that risks can be interconnected and evolve over time
- Putting data at the heart of decision-making so you understand and can meet the changing needs of customers
- Keeping one eye focused on the future so that your organisation can harness new business opportunities while continuing to tackle the societal challenges we face.
At Aon Ireland, our team of over 750 experts are helping to provide Irish businesses with clarity and confidence to make better decisions that protect their organisations and unlock new growth opportunities in the months ahead.
Through our Commercial Risk, Health, Human Capital and Wealth solutions, Aon can support business leaders to cut through the complexity of the current economic landscape and focus on the decisions that will reinforce their organisations’ resilience and agility.
Between the months of October and November 2022, iReach Insights conducted research on behalf of Aon Ireland into attitudes and actions being considered by Irish businesses that face new economic challenges. The survey received 228 responses from senior business decision makers across the country, with 81 mid-sized SMEs, 86 large SMEs and 123 enterprises with 250+ employees taking part in the research.