Reimposition of Covid restrictions hurts business activity in Dublin

The reimposition of Covid restrictions in Dublin had a severe impact on business activity in the first quarter, new figures show.

A survey conducted by IHS Markit on behalf of Dublin City Council shows overall output fell from 49.2 to 40.4, indicating a severe contraction although at a lesser extent than during the first lockdown last year. Any index reading below 50 indicates a contraction in activity

Restrictions also caused a steep drop in new orders at companies in the first quarter, although again the impact was less severe than during the first lockdown a year ago.

Employment increased marginally in Dublin in the first quarter despite declining workloads. This indicates that many companies opted to retain staff ahead of the expected easing of lockdown measures.

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While business activity in the capital remained severely curtailed by restrictions in the first three months of the year there were some signs of confidence indicated by the stabilisation in employment. The gradual reopening of the economy, starting with construction this month, should help activity levels to recover in the second quarter, the survey authors said.