In Legal Business's Ireland Report, Managing Partner of our Irish office, Nicholas Butcher, shares his insights on the challenges that lie ahead in a post COVID-19 world and speaks about the recovery in the Irish legal sector.
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Legal Business' last deep delve into the Irish legal market revealed a country on the rebound. Since the country's exit from a bailout package cobbled together by the European Commission, the European Central Bank and the International Monetary Fund, the island of Ireland had proven itself robust.
By 2019 that recovery looked even more assured: GDP grew a strong 5.5%, making it six consecutive years as Europe's fastest-growing economy. For comparison, Hungary was closest last year to matching its pace with a growth of 4.9%. Sure, the persistent gnaw of uncertainty could be felt as Brexit loomed ever larger, but the feeling was after years of forewarning, Irish business was as prepared as it could be in the face of a tumultuous but manageable 2020.
Of course, no country was truly prepared for what 2020 would bring. The spread of the novel coronavirus Covid-19 saw the Irish government encourage homeworking, place a ban on mass gatherings, and close schools as early as 12 March. By 24 March this turned into a complete national lockdown, grinding the country to a halt.
The resulting economic havoc forced the government to introduce a fiscal stimulus package to offset a surge in unemployment, including the creation of the Temporary Wage Subsidy Scheme. The scheme has since been extended in the form of the new Employment Wage Subsidy (EWS) until 31 March 2021. Meanwhile, concern for Dublin remains widespread, with the city's prioritisation of middle-income public sector employees and suburban shop-goers over its lower-income residents proving damaging as the former stay clear of the urban centre.
But underestimating Ireland always proves to be a mistake. Even now the country is showing its strength, with the country's 6.1% reduction in the economy between April and June half that of the average 12% contraction across countries in the eurozone (the caveat being it is still larger than the 4.7% reduction the country saw in the wake of the 2008 financial crash). The European Commission is expecting Ireland's economy to contract around 8.5% in total across the year, still below the eurozone average.
Much like in London - where many managing partners are pinching themselves as their businesses continue to perform better than anticipated - the Irish legal market is replicating the country's wider defiance. Having weathered the initial storm, the question is for how long can Dublin's legal sector keep it up?
To read the Ireland Report in full click here.
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