Six-Year High As Northern Ireland Firms Get Feelgood Factor

Northern Ireland’s businesses experienced their best month since 2007 in August, according to a bellwether economic report.

The services sector had its best performance in nearly six years, stated the Ulster Bank Northern Ireland Purchasing Managers’ Index – the latest of a string of cheerful economic surveys.

Events like the World Police and Fire Games in Belfast and the Fleadh in Londonderry helped pack out hotels and restaurants, which contributed to the rate of business expansion reaching a six-year high.

It’s the second month in a row in which the index has reporting improving business activity, with companies reporting that they were even able to put their prices up in August after years having to cut them to stay competitive.

But Ulster Bank chief economist Richard Ramsey warned that Northern Ireland was heavily dependent on the UK and Republic and faced the challenged of following up a good summer “with a good autumn, winter and spring”.

“This will be no easy task as there remains no shortage of economic headwinds.”

But meantime, cheerful surveys were “coming in thick and fast”.

“According to the latest PMI survey, the private sector’s impressive performance in July has been surpassed by an even better August. It is a refreshing change to be describing business output growth at a six-year high as opposed to multi-year lows.”

The PMI follows hot on the heels of the Department of Finance and Personnel’s residential property price index for April to June this year, which reported a 2% rise in average house prices across all types of property.

Mr Ramsey said recovery was happening across all sectors, although the beleaguered construction trade saw a fall in new orders and employment.

Services – which includes everything from hospitality to law and accountancy firms – was staging the healthiest recovery.

“The local service industry, the economy’s largest sector and employer, posted a marked acceleration in output, new orders and employment growth last month.

“Indeed, Northern Ireland’s service sector firms reported the fastest rates of growth in all three of these indicators since the fourth quarter of 2007.

“The significant rise in service sector employment in August meant that Northern Ireland firms reported their first back-to-back monthly rise in staffing levels since early-2008.”

He said retail had experienced its busiest month since January 2007, helped by the good weather and one-off events such as the Police & Fire Games in Belfast and All-Ireland Fleadh in Derry.