A recent survey conducted by Ulster Bank indicates that Northern Ireland’s private sector experienced a return to growth in December, marking the first upswing in business activity in six months. The survey, which queries a representative sample of firms on various aspects including new orders, employment, and exports, revealed growth in the retail, services, and manufacturing sectors. However, the construction sector continued to contract.
Despite the positive development, Ulster Bank’s chief economist, Richard Ramsey, expressed caution, noting that sustaining this growth may be challenging. The survey suggested ongoing weakness in new demand, with order books contracting for the seventh consecutive month.
While Northern Ireland’s labor market remained robust throughout 2023, with record-low unemployment levels, Ramsey highlighted signs of change. Some manufacturers, responding to reduced demand, have begun to cut jobs, resulting in the sharpest decline in headcount for almost three years in December.
Official data from the previous week indicated that Northern Ireland’s economy rebounded in the third quarter of 2023, with a growth rate of 0.6%, primarily driven by the services sector. However, economists anticipate relatively flat economic performance in 2024 as households and businesses contend with higher price levels and the impact of elevated interest rates.
The survey results suggest a nuanced economic landscape in Northern Ireland, with growth in certain sectors but challenges ahead, particularly in sustaining demand and addressing shifting employment dynamics.
