Falling orders in NI industry

Northern Ireland may be in danger of missing out on the recovery in manufacturing output beginning to spread across most of Britain. Findings from the latest "Regional Trends" survey from the Confederation of British Industry indicate that the North is the only UK region where manufacturing orders and output are expected to decline in coming months. Already, total orders on the books of Northern Ireland's manufacturing firms have fallen "modestly" compared with the position four months ago and, notes the CBI, "there was a more significant fall in export orders".

"Both total and export orders are expected to fall moderately in the next four months," the CBI says. "A rising proportion of firms cited demand shortage and skilled labour shortage as limiting factors on output." Profit margins remain under pressure from falling prices in both domestic and export markets.

Ahead, firms expect unit costs to rise at the same time as prices continue to fall, leading to further deterioration in margins. Against this backdrop, firms are continuing to cut back on capital spending.

While inadequate returns were cited as the most important limiting factor, more firms cited the cost of finance and lack of internal and external finance.