Posted on Friday 5 April 2019 by John Mulgrew
Northern Ireland’s private sector has suffered its first slump in almost three years as ongoing uncertainty and concerns over Brexit continue.
According to the latest purchasing managers’ index (PMI) from Ulster Bank, business activity in March dropped for the first time in 32 months.
And export orders and job levels both fell at their fastest rate in almost six years.
“The term ‘Brexit uncertainty’ has been overused in the last couple of years, however it is again a major feature of the latest PMI, with the impact of this becoming more and more tangible,” Richard Ramsey, Ulster Bank chief economist said.
“Perhaps more significantly though, export orders and employment levels both dropped at their fastest rate in almost six years, and Northern Ireland firms are increasingly pessimistic about the year ahead. Clearly the potential for a no-deal scenario was exercising the minds of business owners last month.
“Positives were in short supply in the latest survey with manufacturing continuing to be the only sector recording output growth; albeit that stockpiling was no doubt a factor. This is seen in the UK Manufacturing PMI, where stockpiling was reported to be rising at its fastest rate in 27 years.”
And looking at retail, sales activity is declining at its sharpest rate in four years.
“Meanwhile, Northern Ireland’s largest sector, the service industry, took a turn for the worse in March, with output, orders and employment all going lower. Service sector activity hit a 32-month low and staffing levels in the sector are falling at the fastest rate in almost six-and-a-half years,” Mr Ramsey said.
“Last month marked the end of the first quarter of the year, and the deteriorating picture in March meant that it was the weakest quarter in terms of output since Q3 2016. More significantly though, employment and exports had their worst quarter since the first half of 2013.
“However, Northern Ireland is not alone in this regard, with the UK as a whole also struggling on the growth front. Indeed this picture is consistent in Europe as well, where Germany for instance, is seeing manufacturing activity falling at a rapid rate.”