It is heartening to see that the latest data produced by the Ulster Bank Northern Ireland PMI shows a huge surge in business activity across the country. Growth during May has surpassed the levels before the pandemic hit our shores last March, which is wonderful to see. One concern however is the fact that there are inflationary pressures bearing down on the economy which will have to be carefully monitored. The increased costs of raw materials along with the effects of Brexit seem to be the main reasons that inflation is on the up.
Consumers Are Getting Out And Spending Money
This growth is mainly down to the fact that many businesses have now fully reopened and are trading pretty much as normal, and many consumers have looked forward to getting out into the shops and hospitality to spend some money, which they seem to be doing quite readily at the moment.
Business Conditions Have Improved Significantly
Richard Ramsey, chief economist Northern Ireland, Ulster Bank, is quoted in an article in the Belfast Telegraph as saying:
“PMI surveys around the world hit record highs in May. These included the UK and Republic of Ireland — the two most important economies for driving Northern Ireland’s recovery. With the further loosening of lockdown restrictions, business conditions improved significantly in Northern Ireland too. While falling short of record highs, local firms did report the fastest rates of expansion in business activity and new orders in 40 months. The last time local businesses posted faster rates of output growth was back in the summer of 2014.
“All four sectors saw output growth for the first time since January 2019 with retail and manufacturing recording the fastest rates of expansion with PMI readings in the 60s. Northern Ireland’s services firms finally posted a pick-up in new orders for the first time since the pandemic took hold. Construction was the only sector not to see a pick-up in new orders with incoming demand falling significantly and marking the sixth successive month of decline. This contrasted starkly with UK construction firms which saw new orders hit the fastest growth rates to date.
Local Firms Increasing Their Headcount
“The rest of the local PMI survey was littered with highs. Strong growth in domestic demand has led to a pick-up in hiring with local firms increasing their headcount at the joint-fastest rate on record.
“The outlook is certainly improving with local firms the most optimistic about output in 12 months’ time in over three years and sentiment in manufacturing hitting a new survey high.”
If you are a firm in Northern Ireland that needs help with its business growth and managing all financial aspects of the business then please give us a call in the first instance for an informal chat on 028 3752 2909.