Brexit concerns blamed in new order and output slowdown for Northern Ireland companies
New orders fell for the sixth successive month during July, according to a report into the state of Northern Ireland's private sector today.
As a UK region, Northern Ireland posted the fastest rate of decline in new orders and business output, the latest Purchasing Managers Index (PMI) from Ulster Bank has shown.
The monthly survey, considered one of the most up-to-date health checks on the economy, is based on the responses of 200 companies across the manufacturing, construction, retail and services sectors. It found a marked reduction in output during the month of July.
Orders from within the services industry appeared to fall at the fastest rate since December 2012, while manufacturing saw the fastest rate of decline since April 2009.
Ulster Bank's chief economist Richard Ramsey said that after a marked deterioration in business conditions during the second quarter, July's PMI suggested more of the same as we move into the second half of the year.
But he said while output, orders, exports and employment continued to fall last month, the rate of decline eased in July relative to June.
He added: "However, the pace of contraction in output, orders and exports remained significant with output and orders falling at a faster rate than in any other UK region.
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"Firms notched up their seventh successive monthly fall in staffing levels, albeit the pace of job losses in the latest survey was relatively modest.
"Indeed, a number of respondents' efforts to hire were thwarted by a lack of suitable staff. Clearly the lack of supply of workers remains a key issue in the labour market rather than simply waning demand."
The report did show some signs that after months of steady decline, retail sales are finally beginning to stabilise on the back of the depreciating value of sterling, which is expected to boost cross-border sales.
Mr Ramsey said July's PMI showed further signs of the "ongoing fog of Brexit uncertainty" and the global manufacturing slowdown.
Outside of retail, services firms saw a deterioration in business conditions, the economist revealed.
"Significantly, services orders have been falling at an accelerating rate in each of the last five months," he said.
"The employment picture remains the most positive aspect of the latest survey. But it is well known that the labour market is a lagging indicator of economic conditions.
"Shrinking order books, Brexit uncertainty and the ramping up of tensions between China and the US provide a formidable environment for local firms.
"Business conditions could well get worse before they start getting better."