Business lobby Ibec has predicted further strong growth in the economy this year, but has sounded warnings about over-reliance on the construction sector and low productivity in the economy generally. These latest forecasts are contained in Ibec's latest Quarterly Economic Trends publication.

Ibec chief economist David Croughan said gross domestic product (GDP), which measures the amount of goods and services produced in the economy - would continue to grow by 4.6 per cent this year. This contrasts with a recent forecast for GDP growth of 5.7 per cent from the Economic and Social Research Institute (ESRI).

"Very strong employment growth combined with low interest rates is underpinning solid growth of 5 per cent in consumer spending," he said.

But Mr Croughan said that recent economic growth was overly dependent on low productivity sectors of the economy.

"The main concern for the sustainability of strong economic growth was over-reliance on the construction sector and on other sectors of low measured productivity performance. The bulk of the employment increases occurred in these sectors."

Mr Croughan expressed concern about the declining productivity evident from recent data on the economy produced by the Central Statistics Office (CSO). "The performance of the traded sector is a concern because Ireland depended more than most countries on its success in global trade for its growth," he said.

Ibec will argue that forthcoming partnership talks should agree to pay increases that account for deteriorating productivity and that the burden on employers arising from non-pay benefits, particularly pensions, be taken into account.