The high cost of doing business in Ireland including rates and overheads rank top of a list of concerns of small and medium-sized businesses in Ireland in 2026, according to a survey by representative body ISME.
The Irish SME association published the results of its latest member survey on Monday, identifying the priority issues facing SMEs in 2026. Business costs and labour costs dominate member concerns, with 78% of respondents citing business costs rank as the single biggest issue facing SMEs. These include energy, rent, commercial rates and other overheads.
Labour costs follow closely behind, at 76% of respondents. This includes employer PRSI, auto enrolment, statutory sick pay, and related payroll burdens.
“Business costs and labour costs remain the dominant concerns for SMEs, year after year. These are not new issues, and the fact that they persist at such high levels should concern policymakers,” said ISME chief executive Neil McDonnell.
“There is a clear and consistent pattern in our survey results. It is also deeply worrying that long-running problems such as the cost of insurance remain unresolved for so many businesses, despite repeated reform commitments.”
Employee taxation ranks third, with 46% of members citing it as their biggest concern. Members highlighted the combined burden of PAYE, PRSI and USC on workers, as well as the comparatively low income threshold at which employees enter the marginal tax band, creating upward wage pressure on employers to increase gross pay simply to protect employees’ take-home income.
The cost of insurance was the primary concern of 39% of respondents while 38% of respondents said their biggest concern for the year ahead is the use of AI in the workplace and the ongoing challenge of recruitment and retention of talent.
