Dublin experienced a sharp and accelerated increase in business activity in the first quarter of the year as public health restrictions were lifted, according to the latest S&P Global Dublin purchasing managers index (PMI) survey.
The index's headline increased from 59.4 in Q4 to 60.1 Q1, with a reading of 50.0 indicating no change, marking the fourth consecutive quarter of growth, with activity strengthening across all three monitored sectors, led by the construction industry.
In terms of employment, the removal of restrictions encouraged companies to hire at the fastest rate measured since 2018, which supports anecdotal evidence that recruitment has become more difficult this year.
The forward-looking new orders measure also accelerated in the first three months of the year, with new business completing a full year of growth on a quarterly basis.
Growth in new orders signals the potential for strong activity for the remainder of the year despite the threat of supply constraints, which have been exacerbated by Russia's invasion of Ukraine.
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Economic output, employment and new orders increased across the rest of Ireland during the period, but at a weaker pace than seen in Dublin.
"The fading of the Omicron wave of the COVID-19 pandemic helped to boost growth in Dublin in the opening quarter of 2022, with the capital outpacing the Rest of Ireland," said Andrew Hawker, economics direct at S&P Global.
"Reduced concerns around the pandemic were especially good news for workers, as firms in Dublin took on additional staff at the fastest pace in three-and-a-half years.
"The next headwind, however, comes from the impacts of the Russian invasion of Ukraine, with intensifying cost pressures, in particular, having the potential to limit growth in the second quarter."
The S&P Global Dublin PMI is calculated using responses from around 200 businesses per month across the services, manufacturing and construction sectors and the overall PMI is based on the output/business activity questions from each survey.
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