Northern Ireland economy contracted in March

 

Northern Ireland's private sector economy contracted in March for the first time in eight months, largely due to the global downturn and war in Iraq, asurvey found today.

The NTC Research report showed the headline business activity index slipped to 48.5 from 50.1 in February, with firms blaming a marginal decline in incoming new business over the month.

"Those companies surveyed commented that the previously buoyant domestic market had continued to slow through the month, with clients generally reported to be deferring significant investment and spending decisions given geopolitical andeconomic uncertainties," the survey said.

Input prices rose in March, suggesting a further squeeze on profit margins, as companies faced higher fuel, salary and insurance costs. Strong competition was reported to have kept a lid on output prices.

Staffing levels also fell, as weak levels of incoming business and falling profits forced companies to cut jobs.