Robust growth in business activity
Business activity in Northern Ireland has enjoyed a robust rate of growth for the fourth consecutive month, new figures have indicated.
Rises in output and new orders were recorded and e ven though the rate of job creation was slower than at companies elsewhere in the UK, firms did hire more staff in October, according to the data.
The details were outlined in the Ulster Bank's Purchasing Managers Index (PMI), which provides a bench-marked assessment of economic activity every month.
Richard Ramsey, economist for Ulster Bank, said: "Northern Ireland's private sector firms have started the fourth quarter the way they finished the third quarter with business activity, new orders and employment all on the rise."
PMI's survey selected companies and provides an advance indication of what is happening in the private sector economy by tracking variables such as output, new orders, employment and prices across both manufacturing and service sectors.
Mr Ramsey said the results suggested a broad-based economic recovery in the region despite business activity lagging behind other parts of the UK.
He added: "Whilst the pace of business activity eased relative to the September survey, local firms still posted a robust rate of growth last month.
"Meanwhile the rate of growth in new orders held steady which should provide momentum going into 2014. Furthermore, the significant acceleration in output, new orders and employment in the UK and the Republic of Ireland are also encouraging from a Northern Ireland perspective; as our firms are exposed to the economic fortunes of these two economies more so than any other economy. As far as the October PMIs were concerned, the UK and the Republic of Ireland were two of the best-performing economies worldwide."
Construction, which has arguably been hit hardest during the recession, posted its fastest rate of growth in output and employment.
But there were warnings that the increases were coming from extremely low levels.
The strongest increase in employment in over six years, since August 2007, was attributed to a higher number of new businesses and rising backlogs of work, particularly wtihin the services sector.
Mr Ramsey said: "Rising backlogs of work has become a feature within the private sector in recent months across all sectors. Indeed, last month saw the level of backlogs (work not yet started or completed) increase at its fastest rate since August 2007.
"This increase was most pronounced within the services sector and has resulted from a steady increase in demand in previous months. This is both significant and encouraging as rising backlogs of work are invariably a trigger for firms to hire more staff. Indeed, rising employment was particularly evident in the latest survey, with Northern Ireland firms reporting the sharpest increase in staffing levels since August 2007. All sectors reported a marked pick-up in employment growth in October relative to September."
Firms were also able to increase the price of goods and services at their fastest rate in more than five years.
Mr Ramsey said: "Rising employment is one knock-on effect of the improving business conditions. A return in pricing power is another. Last month saw local firms raise the price of their goods and services at their fastest rate in over five years. For many firms this will help restore profit margins after years when passing on price rises to customers was simply not an option."