Covid-19: NI service sector recovering strongly

The Northern Ireland services sector recovered strongly in the second quarter of this year as pandemic restrictions eased.

Output was up 5.5% compared to the first quarter and increased 29.2% compared to the same period in 2020.

Overall output was just 1.2% below pre-pandemic level but with big variations between subsectors.

The production sector, which is mainly manufacturing, also grew and output was just 0.8% below pre-pandemic levels.

On a quarterly basis, production growth was 1.1% and on an annual basis it was 27.6%.

The services sector is the dominant part of the economy covering a very wide range of activities including retail, hospitality, transport and financial services.

'Staycation boom'

The retail and hospitality sector recovered to pre-pandemic levels, 1.5% above the output level in the final quarter of 2019.

Ulster Bank economist Richard Ramsey said this reflected "a staycation boom and the lifting of restrictions".

The transport, storage, information and communications sector also surpassed its pre-pandemic output level, 1.7% above the final quarter of 2019.

The "other services" sector which includes things like theatres and cinemas was still about a fifth smaller than pre-pandemic, reflecting continuing restrictions.

In manufacturing six of the ten subsectors had output above pre-pandemic levels.

Mr Ramsay said that "not surprisingly" textiles had seen the biggest annual growth reflecting the demand for PPE.

But he warned that the figures for transport equipment, which are still 40% below pre-pandemic level, highlights "a severe challenge" for the local aerospace sector.