Report Flags Up Positive Outlook For Businesses

The outlook for businesses in the north is at its most positive since the start of the economic downturn. According to the Northern Ireland Chamber of Commerce’s latest survey, there were no negative indicators in the manufacturing or service sectors – for the first time in six years.

The report, compiled with business advisors BDO provides a barometer of confidence among Northern Ireland firms.

The chamber said the report showed further evidence the north’s economy was “gradually starting to heal”.

But it said despite the growth, largely driven by manufacturing, recovery remained fragile.

The survey showed most indicators had improved compared with the second quarter of the year. It means more companies are reporting an increase across all key indicators including sales, profitability and employment than are reporting a fall.

In manufacturing, domestic sales increased significantly from 20 per cent to 32 per cent.

Cash flow balance in the sector also showed great improvement moving into positive territory at 3.

Domestic sales in services rose from eight per cent to 20 per cent.

However, business confidence in the sector deteriorated both in terms of turnover and profitably.

Overall, a third of firms which export reported an increase in sales while 29 per cent of companies have increased their workforce in the last quarter.

Chamber chief executive Ann McGregor said the increase in the domestic market was “very encouraging and provides a reason to be optimistic about the future”.

“Manufacturing and service firms’ domestic sales are now at their highest levels for many years, however firms need more concrete support if we are to ensure that this does not become an aberration, but rather the norm,” she said.

“The employment indicators were generally good, although we would have liked to have seen more service firms take on staff.”

“The economy has been modestly growing for some time, and we are at the precipice. The government must be bold and implement measures to boost growth further, and the Autumn Statement is an opportunity to do so. ”

Michael Jennings, business restructuring partner at BDO added: “There are definite signs of improvement for both sectors this quarter, particularly in manufacturing; however, the picture for the services sector is less favourable. Although the economy has stabilised, there are still many risks at home and abroad, which means the recovery is still insecure.

“There is no doubt that the economy is picking up, but to ensure the recovery is a long-term one, businesses must continue to campaign for the introduction of pro-growth policies.”