Posted on Monday 25 June 2018 by Ulster Business

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Northern Ireland's economy will grow by just 1.1% during this year as its progress continues to lag behind the Republic, according to a report today.

And business advisory firm EY's Economic Eye Summer Forecast predicts that in 2019, growth will be only slightly better at 1.2%.

In contrast, the Republic's economy will enjoy growth of nearly 5%.

The report forecasts that around 9,500 jobs will be added in Northern Ireland over the next four years, with 236,700 additional positions added across the island as a whole.

And with 74,500 jobs added on the island over the last year, employment has now surpassed 2008 levels.

The most recent employment survey for Northern Ireland reports an increase in employee jobs over the year, with 18,610 jobs added to reach a total of 763,440. The yearly addition is the highest annual increase since at least 2005. Northern Ireland now has an unemployment rate of 3.3%.

EY Ireland chief economist Neil Gibson said the growth in jobs for Northern Ireland forecast for the next few years should be welcomed, even if not all jobs were highly-paid.

"There has been a very, very wide mix of jobs across many sectors, from administrative services to the care industry and industry as a whole.

"It's not just the addition of highly-paid jobs in professional services and ICT. But it is that mix that's allowed unemployment to fall so low. If we only had high-end, high value-added jobs, then we wouldn't have a low unemployment rate. Every job counts and we do great under-service by underestimating the value of jobs in the care services. We should be less pejorative about the types of jobs being created."

He said that across the island, pay increases were more modest than would otherwise be expected.

Mr Gibson said he did not believe that Northern Ireland firms were feeling a major impact from the lack of an Executive. "The real impact is long-term as we do not have the kind of thing which is happening in the UK and Ireland."

"The UK and Ireland were benefiting from decision-making which was leading to outcomes such as city deals and in the Republic, the National Development Plan for growth and investment. You do not notice these things overnight and firms in Northern Ireland are maybe not as worried about the fact there is no Executive as economists might be."

Firms were also not yet worried about Brexit, he suggested - but he urged them to avoid the risk of 'Brexit fatigue'.

"Some have benefited from the currency changes, for example - so I would say, the real year of Brexit is still to come, so they should be making plans for it now."

 

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