Dr Caitriona Cahill, chief economist at the Limerick Chamber | PICTURE: MICHAEL COWHEY
LIMERICK could lose up to €500m in tourism spend across the region, a stark report from the Limerick Chamber has found.
And on top of this, unemployment locally is three times the level it was at prior to the Covid-19 lockdown in March, the business group's chief economist Dr Caitriona Cahill has saisd.
The Chamber’s ‘Mid-West Economic Insights reveals unemployment locally shot up from 4.9% prior to Covid-19 to 32% at the height of lockdown, with latest figures now showing it's back at almost 15% - still three times more than the low earlier this year.The report warns of the need for the region to brace itself for the impact of significant visitor and tourism related revenue decline. Using regional data from Failte Ireland, Limerick Chamber has estimated that the Mid-West had losses of up to €174 million for the second quarter of 2020 alone.
Dr Cahill warned the Mid West is particularly exposed to the adverse impact of COVID-19 on tourism with anticipated annualised losses feared to be between €372 and €496m, though the summer staycation months will have accounted for a partial recovery, she stated in the report.
“Covid-19 is placing significant pressure on retail and hospitality sectors with a number of notable business closures already announced in the city. A vacant site strategy will be urgently needed to tackle the scarring on the city centre and the negative impact this has on revitalisation efforts” she warned.
Commenting on the other findings, Dr Cahill added: "The data paints an honest but stark picture of the impact of COVID-19 to the Mid-West in addition to the underlying economic challenges that were already present. Within the challenges there are opportunities – notably the mass adoption of remote working practices by organisations and the comparatively low cost of residential housing in the Mid-West."
But she warned in order to capitalise on any opportunities and ensure a balanced recovery, government must recognise the regional differences and ensure "existing regional imbalances" are not worsened.Meanwhile, the report finds that the number of Foreign Direct Investment jobs in IDA supported companies in the region now accounts for 11.4%, up from 9.5% in 2012. Furthermore, Limerick ranks second nationally for county level FDI associated employment at 25.3%, only surpassed by Dublin at 29.1%.
This endorsement of the value proposition for inward investment is welcome news. However, threats posed to Shannon Airport’s connectivity brought about by the onset of the pandemic, and the airports significance in terms of FDI were also highlighted as a vulnerability to the wider economy.
“The impact of COVID-19 on the operations of Shannon Airport is of significant concern as the airport contributes €3.6 billion to the economy and supports 45,595 jobs,” Dr Cahill states.