Belfast Telegraph

Brexit could cost Northern Ireland 8,200 jobs by 2027 'in worst case scenario'

By Margaret Canning

Around 8,200 jobs could be lost in Northern Ireland over the next decade if the worst happens and Brexit is badly managed and real incomes squeezed as a result, it's been claimed.

But the summer economic forecast of Ulster University's Economic Policy Centre (UUEPC) added that a "trade-friendly, smooth transition" could increase job levels by 87,500 by 2026.

Economic indicators here would need to catch up with the rest of the UK to achieve the optimum growth, it added.

UUEPC associate director Gareth Hetherington said job numbers had grown by around 60,000 from 2012 to 2016 but added that the pace of growth reflected Northern Ireland's emergence from a downturn.

And the UUEPC today also predicted that manufacturing jobs would be hardest hit in the event of a disruptive Brexit process, stating that the most likely outcome was growth in jobs of 28,800 in the next 10 years.

Mr Hetherington said: "Due to the potential for significant policy shifts with respect to migration, trade, funding and borders, the range of potential labour market outcomes in the longer term remains wide. However, the key determinant of success will be the outcome of the Brexit negotiations. In the interim, this presents a challenge to key decisions makers in business and government alike".

The outlook said Northern Ireland's economic performance will slow to a rate of 1.1% this year, compared to 1.5% in 2016. Expansion would then slow even further over the next few years to reach 1.4% in 2020.

Mr Hetherington said: "The robust performance of the local economy over the last few years has been reflected in strong job growth across a wide range of sectors.

"This demonstrates a resilience to external events, but the economy remains very dependent on consumer spending, and therefore the primary risk to economic growth moving forward is a squeeze on incomes.

"The forecast slowdown in growth reflects a 'Brexit effect' from lower levels of business investment, but of greater significance is the slowdown in the growth of consumer spending."

He said that consumer spending was only likely to increase in future if incomes grew, after 10 years of flat real wage growth.

"People may be prepared to tolerate zero growth in salaries if inflation is very low, but when prices are increasing at over 2.5%, the pressure for higher wage settlements across the public sector is likely to be much stronger," he concluded.

Belfast Telegraph