A top economist has warned that rising interest rates have already impacted Dublin's tech sector with "loads" of companies "laying people off for the first time."
There are many indicators that a global recession is on the way including the European Central Bank raising their interest rates for the first time in 11 years and runaway inflation.
The latest Dublin Economic Monitor said a recession was "an increasingly realistic possibility" due to Mastercard data which showed that spending in the capital fell by 8.3% from Q4 2021 to Q1 2022.
Read more: Recession for Dublin 'increasingly realistic', says capital's economic monitor
David McWilliams said a credit crunch has hit tech's global capital, an area of San Francisco called Silicon Valley, which has resulted in job losses in Dublin.
On a recent episode of The David McWilliams podcast, he said: "I have heard from people I know in Silicon Valley that the credit crunch is there. That you cannot get capital. Silicon Valley has gone from getting any old gobsh**e with any old idea could get tens of millions of quid. There is no capital there now.
"It has changed over night. The big issue in Dublin is that loads and loads of the tech companies are laying people off for the first time in ten years. There has been a total collapse in the optimism of tech. The optimism, the effervescence, the idea that the world is changing.
"And of course many of those companies use their share price as their balance sheet in effect. So their share price was rising so they felt we can so this because we have this balance sheet.
"They were using their share price as currency to buy other companies or to pay workers."
However, Mr McWilliams added the job losses and decline of the tech sector in Dublin could result in lower rents in the city centre.
He said: "The increase on interest rates is already having an impact on the frothier end and that is technology. We will see that impacting here because what is keeping rents up are all the high paid tech workers in town. So lets see what happens."
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