Covid-19: NI economy shrinking in ‘uncharted territory’

The initial 9.6% estimate is the result of research carried out by the Ulster University Economic Policy Centre (UUEPC) as the number of NI workers placed on furlough or temporarily laid-off reached 235,000.

UUEPC director Gareth Hetherington said the unprecedented crisis has created huge challenges.

“The current situation is unique in economic history,” he said.

“We have dealt with wars, recessions, financial crises and pandemics before and through painful experience developed policy responses for each of these, but never before have governments collectively told their populations to stay at home and in doing so, shut down a significant proportion of global economic capacity. The challenge facing policy makers is huge because we simply don’t have a playbook to follow, this is unchartered territory.”

Commenting on the need to prioritise public health over the economy, Mr Hetherington said: “To date the approach has been, quite correctly, to prioritise public health, but we also recognise that economic recessions anddepressions also come with a significant human cost.”

He added: “The unenviable decision facing political leaders will be when to shift the balance of that trade-off. The timing of that decision will be very difficult and highly contentious.”

Earlier this week, NI Chamber of Commerce chief executive Ann McGregor said Northern Ireland’s economy has been devastated by the crisis with only one in five businesses able to avoid staff lay-offs.