A new analysis from the Competition and Consumer Protection Commission has highlighted a notable weakening of competitive pressures across several key segments of the Irish services sector. The findings form part of the CCPC’s State of Competition in Ireland programme, which is reviewing developments in non-financial services over a fifteen-year period from 2008 to 2022.

The study notes a clear upward trend in market concentration and average markups, particularly since 2016. According to the CCPC, this indicates that certain industries now contain firms with significantly stronger market power than they held a decade ago. By 2022, the four largest firms in many service markets held an average combined share of 37 percent, which represents a substantial rise compared with 2008.

The pattern echoes shifts seen in other developed economies, where digitalisation has contributed to consolidation. The CCPC’s analysis shows that the trend is strongest in digitally intensive fields. Information and communications services, along with professional, scientific and technical services such as accountancy and legal practices, are now dominated by a smaller group of firms generating a larger proportion of overall turnover.

Although concentration is increasing in many areas, the picture is not uniform. The study records falling markups in sectors such as arts, entertainment, recreation, transport and storage. It also highlights a positive dynamic where younger firms are securing a larger share of turnover and contributing to productivity gains. This suggests that new entrants can still have a meaningful competitive impact when barriers are not excessive.

In parallel with the main report, the CCPC has published separate examinations of barriers to entry and expansion. These assessments identify several factors that can restrict business growth or discourage new firms from entering the market. The most significant obstacles include limited financial capacity, regulatory constraints, insufficient market knowledge and the high cost of legal compliance. The CCPC argues that tackling these barriers would support stronger competition and benefit the wider economy.

The Commission notes that many of these issues have been highlighted before. More than twenty years have passed since proposals for reform of the legal sector were first published, yet progress has been limited. The CCPC says this reinforces the need for Government action, and it welcomes commitments made under the Action Plan for Competitiveness and Productivity.

CCPC Chairperson Brian McHugh emphasises that healthy competition is essential for economic resilience. He describes the findings as a warning sign, pointing to rising concentration, growing market power and reduced turnover among leading firms in some industries. He adds that the watchdog will use the data to guide its future regulatory focus and to target areas where stronger competition could deliver the greatest benefit.

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