Northern Ireland’s private sector has continued to expand in light of easing inflationary pressures and increasing demand.
That’s according to the latest Purchasing Managers’ Index (PMI) from Ulster Bank which unveiled the third consecutive month of expansion for the province’s companies with growing workloads and widespread hiring.
Activity grew across services, construction and retail, dipping only in manufacturing, as order books lengthened. Perhaps emboldening consumers was a fall in input costs as the rate of inflation eased for the seventh consecutive month.
The robustness of the local employment sector came into sharp focus once again with staffing levels rising sharply last month. Unemployment levels have remained low over the last few months despite rising interest rates and strong inflation, although that could be a result of the fact the jobs market is a lagging indicator of economic health.
Richard Ramsey, Ulster Bank’s Chief Economist, said even delivery times for goods have fallen.
“Supply chain disruption has blighted the economy since the pandemic first hit,” he said. “But April’s survey revealed that firms saw supplier delivery times shorten for the first time since the question was introduced back in March 2021.
While the private sector may be in good health, Mr Ramsey pointed out that Northern Ireland’s public sector, which employs a comparatively large amount of workers here, is not in as good shape.
"Overall, the steady improvement in the private sector is in stark contrast with the mounting difficulties within the public sector,” he said. “Budget cuts and a scaling back of public services will also have implications for parts of the private sector too.”
The private sector, meanwhile, doesn’t appear to be out of the woods yet, Mr Ramsey said.
“Meanwhile, the headwinds of higher interest rates and increased taxation will increasingly be felt by all parts of the economy in the year ahead."
