It is a little confusing since "people" is a collective singular noun in English, and daoine is plural in Irish. It would be clearer if "persons" was used as a translation, but that's not the common English way of saying it.
I wouldn't have thought "people" would typically function as a singular collective noun in English. E.g. People are talking (not is). It's what the people want (not wants). I guess it does sometimes function collectively, but I wouldn't say it's the norm?