Economic optimism not evenly spread, as small firms still face struggle
Businesses in Northern Ireland are at the "rocky bottom of recovery" with improvements in the economy failing to benefit firms of all sizes, it's been claimed.
While the Northern Ireland Chamber of Commerce quarterly economic survey today reveals that more businesses are reporting rising domestic and export sales, employment and investment intentions, the optimism is not, however, evenly spread.
The smallest firms – those with fewer than 10 staff – were struggling to recover at the same pace as larger businesses, according to the Bellwether Survey.
Fewer micro-businesses were reporting increased sales, exports or intending to take on new staff than their bigger counterparts.
Tax partner, Sean Lavery, at business advisors BDO, which helps produce the survey, said export-focused companies – especially those focused on the Great Britain market, and to a lesser extent, the Dublin and greater M50 market – tended to be the most optimistic among them.
There was some confidence – but he added: "That confidence is fragile, reflecting that we are still at the rocky bottom of recovery."
Energy costs were the uppermost concern for businesses, with 77% of businesses maintaining that energy costs in Northern Ireland were higher than elsewhere in the UK and EU.
Just over 70% of firms had experienced rising energy costs over the year – and nearly 80% of manufacturers said their bills had shot up over the past 12 months. Around two-thirds of members reported that they had been forced to take some action to reduce their energy costs.
Ann McGregor, chief executive of NI Chamber, said: "There are some positive indicators for the Northern Ireland economy this quarter and we are making progress towards recovery.
"However, it is still not clear that any strong recovery has taken hold, and businesses are still facing considerable challenges. The most welcome results are in the export indicators.
"These indicators have been very low for a number of quarters, so it is good to see a noticeable improvement on this occasion."
Rising energy costs were a major problem, Ms McGregor said, with the province's energy costs the second highest in the EU after Italy.
"We simply cannot accept this and must continue to work with government to address the issue," she added. "In the meantime, businesses should at least have an energy audit carried out on their premises and business processes, in order to find out exactly where energy is being wasted and then implement improvements.
"Financial support for sustainable energy initiatives, such as the Renewable Heat Incentive (RHI), and interest-free loans, can also help drive down costs."