Business hopes still in decline
NORTHERN Ireland businesses started 2012 in much the same position as they closed 2011 as the decline in overall activity continued according to the latest Ulster Bank PMI report released today.
The report said job losses occurred at the highest rate since last June as business activity fell for a second successive month during January despite output growth at UK level.
The seasonally adjusted Business Activity Index posted 46.4 in January, up slightly from 46.2 in the previous month.
“Some local firms continued to report an improvement in output, exports and employment,” said Richard Ramsey, Ulster Bank chief economist for Northern Ireland.
“However, overall in the private sector, these firms are still being outnumbered, with more than a third of local companies signalling a decline in business output, and the survey’s main index again not crossing the 50.0 threshold (denoting growth) for the 50th month in succession.”
Whilst the UK recorded its highest rate of growth in employment in 11 months, Mr Ramsey said private sector firms here posted their sharpest rate of job losses since June last year, with all sectors reporting lower staffing levels in January.
“An area showing a welcome improvement amongst local firms is costs and prices,” he said.
“Input cost inflation, although still strong and significantly above the UK average, eased to its lowest rate in 14 months. Meanwhile, the pricing power of local firms improved in January, with the price of goods and services rising at the fastest rate in five months. Manufacturing and retail remain the two sectors passing on cost increases, with price rises in their goods and services.”
He said the retail sector had recorded growth in activity and new orders last month, but he warned that profitability remained a key concern within the industry.
“Manufacturing saw a bumper fourth quarter of 2011, then dipped into contraction territory in January, but the underlying trend is one of growth. Whilst the local construction sector continues to experience a torrid time in terms of lack of demand and profitability, the key concern remains with the economy’s largest sector - the services industry.
“For the UK as a whole, the services sector is the strongest sector by quite some margin, but in Northern Ireland the sector is contracting at the fastest rate of all sectors in terms of both output and employment.”
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Weather for Belfast
Tuesday 29 May 2012
Today
Sunny spells
Temperature: 12 C to 21 C
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