NI economy: About half of businesses see demand slow down

A total of 188 businesses representing more than 30,000 employees took part in the survey

Businesses in Northern Ireland lost momentum in the third quarter of the year, a survey suggests.

A total of 188 businesses representing more than 30,000 employees took part in the survey carried out by the NI Chamber and business advisory firm BDO.

While three quarters of firms say they are performing well or reasonably well, more than half (55%) saw a slowdown in demand.

Respondents were concerned by inflation and the lack of a Stormont Executive.

Despite an easing in inflationary pressures, 62% of respondents said they were more worried about inflation than they were three months ago.

The rate at which prices are rising remained unchanged at 6.7% in the year to September compared with August.

NI Chamber chief executive Suzanne Wylie says the absence of an executive exacerbates challenges

NI Chamber chief executive Suzanne Wylie said the absence of Stormont was the main issue identified by her members.

"We can see the impact of that played out in indicators like business confidence, where there has been a loss of the positive momentum gained in the first two quarters of this year," she said.

"In such a difficult trading environment, particularly for manufacturers, NI Chamber has repeatedly stressed the urgent need for the executive to return.

"The issues are stacked up and while we know that having ministers in place won't solve all the problems overnight, the absence of a functioning executive exacerbates the challenges and inhibits our ability to maximize opportunities."

Businesses are still struggling to recruit and three quarters of those who took part in the survey said rising wage costs were putting pressure on them to raise their prices.

'Resilience'

BDO NI managing partner Brian Murphy said despite the pressures of inflation, higher energy costs and increasing labour costs it was important to reflect how far things had come in three years.

"That local businesses are performing as well as they are is a testament not only to their resilience but also to their willingness and ability to adapt," he said.

The survey was carried out ahead of the implementation of the Windsor Framework, which meant red and green lanes started operating on 1 October.

Almost half (49%) of members said they were positive about the potential impact of these changes on the Northern Ireland economy, 14% were negative, 17% were neutral and 15% said it was "too early to say."

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In terms of the impact on their own business - about one third said positive, 14% are negative, 35% said "neutral" and 11% said "too early to say".

Ms Wylie said her organisation was closely monitoring the impact of new trading arrangements.