Irish business will become increasingly reliant on immigrants as labour shortages could threaten future growth, a group representing small businesses said today.
The latest quarterly survey by small business association Isme reports the small business sector in good health, with business confidence, employment and investment returning to Celtic Tiger levels.
Over one-third of small or medium size enterprises (SMEs) are planning to hire more workers in the next 12 months, and only 5 per cent expect to cut staff, the lowest figure recorded in five years.
However Isme warns that rising labour costs in the tighter market could choke off the boom if the Government doesn't act now to attract migrant workers.
Isme chief executive Mark Fielding warned it is "absolutely essential" that a comprehensive immigration policy with a 'well-planned' system to identify and attract foreign workers be initiated immediately to ensure that employment opportunities that exist are filled without delay.
Manufacturers are most concerned about the erosion of competitiveness, with labour costs the next biggest concern, the survey found.
However, the services sector outlined that 43 per cent were primarily concerned with labour costs and a significant 20 per cent were mostly concerned by labour shortages.
Mr Fielding cautioned that the current feel-good factor needs to be tempered by the persistently high local costs such as energy, labour and local charges.