MHA Manufacturing Report 2026: Confidence is strong in Irish manufacturing sector despite continuing global uncertainty

• 80% of Irish manufacturers expect growth of 3% or more in the next 12 months
• Growth expectations complemented by plans to increase R&D spend
• Cybersecurity and skill shortages are seen as the top challenges, followed closely by energy costs
• Investment in technology and strengthening IT capability seen as key actions to be taken

The findings of the MHA Manufacturing Report 2026 show that Irish manufacturers are confident in the outlook for the next 12 months, with the research pointing to a sector that is continuing to invest despite rising operational pressures and an ongoing backdrop of global macro-economic uncertainty.

There is a high level of confidence across the survey as a whole, with 81% of respondents expecting growth above 3% over the next twelve months.  45% of Irish-based manufacturing firms expect to see growth of 3-5% in the next 12 months, while just over one third (35%) expect strong growth of between 6-10% in the same period. 

This resonates well with IBEC's most recent economic outlook which forecasts domestic demand growth of 2.8% for 2026, and that the Irish economy continues to show sustained momentum. Their report also highlighted that 78% of Irish goods exports to the US have so far remained exempt from tariffs. That export resilience supported by Ireland's dual access to EU single market and North American trade flows, helps explain a confidence level that echoes that of this survey. 

The investment picture tells a similarly positive story. Across the full survey, R&D budgets are expected to rise by around 5% on average over the coming year with 83% of Irish firms expecting growth of 3% or more in their R&D spend over the next 12 months, with technology adoption being the top net investment priority of any region surveyed at 57%.  This echo’s the trend that the IDA in Ireland have reported, with a record 323 foreign direct investment projects secured during 2025, up 38% on the previous year, with 80 of those investments specifically focused on research, development and innovation and a record €2.5 billion in future RD&I commitments from IDA client companies. 

Manufacturing companies account for 25.6% of R&D tax credit claims in Ireland but receive 66.6% of total credit costs, underlining the outsized role the sector plays in Ireland's innovation economy and the particular benefit these reforms deliver to manufacturers. 

The landscape in Ireland broadly mirrors the report's overall findings, with cybersecurity cited by 43% of Irish respondents being a leading concern.  Last year Ireland's National Cyber Security Centre launched its 2025 National Cyber Risk Assessment warning that cyber risks are evolving rapidly and that critical infrastructure, government systems and businesses face growing exposure. With a 23% year-on-year increase in significant cyber incidents happening in a highly connected economy hosting over 1,800 multinational companies, the attack surface is considerable, and the survey data suggests Irish manufacturers are acutely aware of their exposure. 

Skills shortages register an equal amount at 43% among Irish respondents, again above the survey-wide figure of 32%.  More than half (57%) of respondents reported partnering with colleges and universities to develop future talent pipelines, reflecting a growing focus on aligning academic programmes with industry requirements. These collaborations are helping businesses access emerging talent while ensuring graduates are equipped with the skills needed to thrive in a rapidly evolving economy.

Nearly half (47%) of businesses said they are prioritising staff upskilling initiatives, recognising that building new capabilities within their teams is essential to strengthening resilience, supporting innovation and maintaining competitiveness in a changing business environment.

Recruitment also continues to play a critical role in workforce development strategies, with 40% of Irish businesses citing the hiring of new staff as a key response to skills and labour challenges. Asked what Governments could do to ease business challenges over the long term, the most commonly cited measure was as increase in investment for education, skills and training (cited by 23% of respondents), followed by an improvement in conditions for accessing finance related to capital expenditure (22%)

Investment in technology and artificial intelligence is also being employed as a means to overcome workforce challenges, with 53% of respondents reporting the use of artificial intelligence to offset skills shortages. As businesses seek to remain competitive and address workforce challenges, technology is playing an increasingly central role in driving efficiency, innovation and long-term growth.

This is consistent with wider findings from Irish business bodies. IBEC's 2025 Skills Survey found that 82% of Irish firms are reporting significant skills gaps that are actively undermining productivity, innovation and competitiveness, with digital and AI capabilities among the most acute shortfalls. 

On cost pressures, Irish firms report energy costs were also a key concern for 40% of companies as the domestic economy continues to grapple with external pressures.  This too sits above the survey average and reflects a structural issue that Irish industry bodies have consistently highlighted. IBEC has called on government to adopt a new national energy and industrial strategy that accelerates the roll-out of low-cost renewable generation and storage technologies to bring Irish energy costs into line with European norms. 

Notably, despite continued pressures arising from Washington, only 16% cited tariffs as a key concern for the year ahead. Just over a quarter (27%) highlighted potential tax increases as among the top challenges.  Ireland's position as a net beneficiary of both EU trade frameworks and US corporate investment has so far protected many manufacturers from the worst of global trade disruption.