North’s private sector employment rising at fastest rate since 2007
Latest figures show that recent trends in the Northern economy are sustained
The latest figures show that recent trends in the Northern economy are sustained and not the product of one-off events
Private sector employment is rising at the fastest rate since the advent of the crash in 2007, the latest Purchasing managers Index (PMI) for Northern Ireland has shown.
The index, produced for the Ulster Bank by Markit, also highlights a solid rise in employment generally, the easing of inflation pressures and a fourth successive rise in output.
The latest figures, published on Monday show that recent trends in the Northern economy are sustained and not the product of one-off events such as the World Police and Fire Games held in Belfast during the summer or the staging of the All-Ireland Fleadh in Derry in August.
The headline seasonally adjusted Business Activity Index posted 57.6 in October from 58.7 in September, signalling another strong expansion of private sector output in October, although the rate of growth remained slower than the UK economy average. All four sectors posted higher activity. Where output rose, panellists mainly linked this to higher new orders. New business rose markedly, extending the current sequence of expansion to five months.
In the labour market, higher workloads fed through to rises in both backlogs of work and employment during October. Staffing levels increased for the fourth consecutive month, although the rate of job creation at Northern Ireland companies was slower than recorded across the UK economy as a whole.
On the inflation front, the rate of input cost inflation slowed from September’s 17-month high and was weaker than the series average.
However the rise in input costs was still faster than the UK average. Where input prices increased, this was partly linked to higher energy costs, while some respondents mentioned a rise in the UK minimum wage.
“Northern Ireland’s private sector firms have started the fourth quarter the way they finished the third quarter with business activity, new orders and employment all on the rise,” said Richard Ramsey, the bank’s chief economist in Northern Ireland.
“While the pace of business activity eased relative to the September survey, local firms still posted a robust rate of growth last month. Meanwhile the rate of growth in new orders held steady which should provide momentum going into 2014.”
The significant acceleration in output, new orders and employment in the UK and the Republic are also encouraging, he added “as our firms are exposed to the economic fortunes of these two economies more so than any other economy”.
“As far as the October PMIs were concerned, the UK and the Republic of Ireland were two of the best performing economies worldwide. In Northern Ireland, the recovery remains broad based with all sectors signalling higher levels of activity last month. Meanwhile, construction posted its fastest rate of growth in output and employment since the series began. However, it should be remembered that these increases are coming off extremely low levels.”