Posted on Monday 9 September 2013 by Ulster Business
The Ulster Bank Northern Ireland PMI report, produced by Markit, showed business activity on the rise for the second month in a row, with new business increasing, longer backlogs in work and further improvement in employment.
The survey is the latest in a run of recent indicators to suggest the economy is picking up, following reports showing a fall in unemployment and a small increase in house prices.
Commenting on the survey findings, Ulster Bank's chief economist Richard Ramsey said: "It is a refreshing change to be describing business output growth at a six-year high as opposed to multi-year lows.
"The recovery remains broad based across all sectors of the economy although the construction sector posted a fall in new orders and employment last month. However, it is particularly encouraging to note that the local service industry, the economy's largest sector and employer, posted a marked acceleration in output, new orders and employment growth last month. Indeed, Northern Ireland's service sector firms reported the fastest rates of growth in all three of these indicators since the fourth quarter of 2007. The significant rise in service sector employment in August meant that Northern Ireland firms reported their first back-to-back monthly rise in staffing levels since early-2008," he added.
"As expected, the retail sector had a stellar performance in August and reported its busiest month since January 2007. This was aided by the unusually good weather and a couple of one-off events. These included the World Police & Fire Games in Belfast and the All-Ireland Fleadh in Derry / Londonderry.
"Looking ahead, the Northern Ireland economy will remain particularly sensitive to the strength of the economic recoveries in the UK and the Republic of Ireland. Put simply, the stronger the recoveries in these two economies the more secure the economic recovery will be in Northern Ireland. The local economy has undoubtedly enjoyed a good summer; the challenge is to follow this up with a good autumn, winter and spring. This will be no easy task as there remains no shortage of economic headwinds," said Ramsey.
The rate of business activity expansion in August quickened and was the sharpest since August 2007. The fastest expansion was at retailers, while strong growth was also recorded at manufacturers and service providers.
The rise in activity was supported by higher new business, which extended the current period of expansion to three months. The rate of growth remained marked, but eased slightly over the month and was weaker than the UK average. As with activity, retail posted the fastest rise, while only construction saw a fall in new business. New export orders, meanwhile, increased modestly for the second month running.