Latest statistics from the purchasing managers index (PMI), which is produced by Ulster Bank, show that inflationary pressures are ramping up for businesses in Northern Ireland. The September survey showed a return to an alarming trend, after a brief slowdown in inflation in August, with prices moving up at a rate not seen since this particular survey began back in 2002.
Astonishing Rises In Raw Energy Prices
The last few weeks have seen astonishing rises in raw energy prices, for which many businesses are not protected from. Many sectors of industry are reliant on using large amounts of gas to run their business, so energy hikes which have gone up at one point by around 900%, make keeping their company buoyant virtually impossible. A lot of businesses are saying that if some government intervention is not forthcoming, to either put a cap on the energy prices for them or get extra funding, then they will have to cease production whilst prices are so high, or worse still go into liquidation.
The PMI survey showed that selling prices moved up to a record high last month as businesses in the main had no alternative than to pass on some of the increase in costs onto the consumer.
Double Whammy For Businesses
There has been a double whammy for businesses recently with the ongoing supply chain issues hampering them as well as a rise in costs, and this has led to an overall fall in new orders in Northern Ireland. Supplier delivery times are lengthening by the week which is a huge concern for many as we edge ever closer to the Christmas period.
Retail and construction seem to be the sectors which have been hit most by all of the above, but thankfully there is still some optimism around among the business community as we move out of the Covid-19 crisis which has engulfed the world over the last 18 months.
Could Things Look A Lot Rosier In A Few Months Time?
So what we will hopefully see in the not too distant future is energy prices beginning to stabilise, as if this is complemented by the government giving financial help in some form or another to get businesses who need it through this turbulent period, then things may look a lot rosier in a few months time. The supply chain issues are definitely going to be with us for a while yet, but again it shouldn`t be beyond us to see a way through this with a bit of give and take from all sides. Let us sincerely hope so.