Much of the north’s private sector continued to perform well during September, a new business survey from Ulster Bank suggests.
The latest monthly growth tracker from the lender, published today, found activity in Northern Ireland’s private sector continued to outperform the rest of the UK for the third month running.
Headline business activity increased to a four month high in September, according to the survey.
The monthly tracker, also known as the purchasing managers’ index (PMI), is based on the feedback from 200 respondents across the north’s construction, services, manufacturing and retail sectors.
Ulster Bank said the north’s manufacturing and services sectors posted the strongest increases in activity in September.
Construction activity was also up, but retail recorded a decline.
The official figures published last month showed the north’s economy grew by 0.4% in the second quarter of 2024, driven by the services and construction sectors.
The new report from Ulster Bank noted a solid increase in new orders during September, while companies continued to take on extra staff.
However, input cost inflation remained marked and output prices increased at the fastest pace in three months.
“The Northern Ireland private sector completed a full quarter leading the pack in terms of output growth in September, an impressive feat for an economy that this time last year was struggling deep in contraction territory,” said Sebastian Burnside, chief economist at Ulster Bank’s parent company NatWest.
“Central to the rejuvenation of the private sector has been the success firms have had in securing new orders, and this continued in September, albeit with the pace of growth easing to a seven-month low.”
The survey suggests companies continued to hire additional staff in an attempt to deal with the influx of new work, but the familiar challenges of finding suitably skilled staff in the local labour market was again evident, which meant that backlogs of work accumulated again in some areas.
“While unlikely to be a short-term fix, any efforts to help upskill the local workforce would give firms a better chance of getting work completed on time and keeping customers happy,” said the economist.
“Perhaps linked in some part to staff shortages, wage pressures were again the key factor behind a further sharp rise in firms’ costs.
“Behind the generally positive story across the private sector, evidence of a two-speed economy has emerged,” added Mr Burnside.
“Growth continued to be driven by manufacturing and services, while the picture was much more muted in construction and retail.
“For now, the private sector seems in a good position to finish off the year with a flourish.”