The Northern Ireland Protocol is not the most challenging issue facing NI manufacturers, a survey of industry here has found.
Traders’ Experience of the UK Protocol One Year On, compiled by trade organisation Manufacturing NI, said a lack of people rather than the protocol, is the biggest strain on its members.
It said 60% of manufacturers reported that access to labour is their biggest issue, with four out of five (80%) ranking this as their number one or two problem.
The poll also revealed that one in four NI manufacturers no longer struggle with the processes in the Irish Sea. This is down from 40% six months ago.
It said: “The rest, more than two-thirds, experienced no impact, are on top of the issues or see them resolving soon.
“This demonstrates that as firms become more experienced, or adjusted, they believe issues do not impact negatively on their business.”
The NI Protocol is the means by which a hard border was avoided on the island of Ireland post-Brexit. It has kept Northern Ireland in the EU single market for goods, creating a de facto sea border with Great Britain (GB).
The findings were taken from 163 responses to a survey undertaken from January 6 to 12.
The goal of the study was to assess and understand issues facing the sector since Brexit and put these to the UK Government and the EU to resolve.
It said work is still needed to educate EU traders and a lack of GB supplier readiness and willingness remains the biggest issue related to the Protocol.
One in five manufacturers reported their GB suppliers are unwilling to send products — an issue that has remained consistent throughout 2021.
The report said: “With GB import controls now beginning to be implemented, it could be the case that as more GB traders are exposed to and become experienced in customs formalities that more GB firms may be willing to send goods to NI.”
Positives taken from the survey include a rise in sales to the EU as afforded by the Protocol.
Just over 25% (28%) of those surveyed said they experienced an upswing in sales to the EU.
There is also “a significant rise from 6.4% to 20.4% of businesses reporting they’ve had an increase in business with GB as a result of the protocol”.
One-third of NI manufacturers believe disruption will persist – however that figure is down a quarter from July 2021.
The report said the biggest challenge for NI manufacturers at present was securing employees.
It read: “NI has lost one-third of its EU migrants since the EU referendum in 2016 and the usual flow of people arriving in NI to work has virtually stopped during the pandemic.
“We also know that there are fewer people of working age coming onto the labour market in this and the decades to come.
“Without labour businesses cannot generate the income required to invest in automation. It is clear that the NI Executive and UK Government must find a way for firms to access people, even on a temporary basis, until investment in skills matures and businesses can plan and deliver on investments.”
At the time of publication, the survey said its respondents had a total of 1,115 job vacancies.
“It shows how pronounced the labour shortage is,” it added.
The report concluded: “Whilst there are ‘Protocol Pragmatists’ the results confirm that there are still problems within the new arrangements which need resolved.
“Two-thirds want the protocol fixed; one-fifth want it ditched.”