Businesses in the North are the “least optimistic” about 2019 compared to firms based in any part of the UK and they blame Brexit for their pessimistic outlook, a new survey shows today.
Firms in Northern Ireland say Brexit has dampened demand for their products and services and is also beginning to hit export orders.
According to the latest Ulster Bank Northern Ireland PMI survey, published on Monday, although the North’s private sector continued to grow last month and firms continued to win new export orders during November, it was at the slowest pace since the EU referendum.
Businesses in the North were also affected again last month by the weak pound, which led to additional “cost burdens”, including raw material price increases and higher staff costs.
Richard Ramsey, chief economist of Ulster Bank in Northern Ireland, said that although the latest survey highlighted “rising business activity, expansion in order books, and staffing levels continuing to increase” in the North during November, there were also less positive aspects.
“The reality is that the rate of expansion is relatively subdued compared to longer-term averages. Indeed, the final three months of the year are shaping up to have the weakest rate of growth in nine quarters. Meanwhile, export orders are set to have their weakest rate of growth in 10 quarters,” Mr Ramsey warned.
UK slowdown
He said the slowdown in the North’s private sector was also weighing heavily on business confidence levels.
“Business confidence improved in November from October’s low, but this was solely due to the services sector. Retailers and manufacturers saw their confidence levels hit new lows when looking to the year ahead, while construction firms, which have been experiencing falling output and orders, expect more of the same next year.
Another factor affecting confidence in Northern Ireland is perhaps the relatively poor performance of the UK economy, which has experienced a marked slowdown in the fourth quarter,” he added.
