The State of Britain


Mid and East Antrim the province’s only area to record productivity above the UK average, productivity growth in the UK top ten and NI retains the unemployment crown

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Like most ‘regions’ of the UK, output per hour in NI is below the UK average. Productivity per hour in the province was 16% below the UK average which ranked NI tenth nationally for 2018. One reason for this is the high levels of hours worked and high productivity in London and South East which pulls up the UK average so much that all other regions fall below it.

The ONS has now released data for a longer period and at a subregional level. This gives further insight into NI’s performance. At the district level Northern Ireland data is only available for GVA per filled job, whereas the data for other parts of the UK also includes GVA per hour worked so although similar the stats are not exactly comparable.

Perhaps the most useful data is the 2018 results for the 44 enterprise regions in the UK which comprise the 38 English local enterprise partnerships (LEPs) and six enterprise regions in Scotland, Wales and the border regions.

Thames Valley Berkshire LEP had the best productivity (in terms of hours and jobs) in 2018 at 35% above the UK average whereas the Black Country LEP at 24% below was the worst. At -16% Invest NI would be ranked around 33rd.

In terms of productivity growth between 2010 and 2018 the Coventry and Warwickshire LEP was top with growth of 16%. Twelve economic regions recorded productivity levels lower in 2018 than 2010. The worst performer was the Buckinghamshire Thames Valley LEP which saw productivity drop by 11%. At c5% growth Invest NI would likely be ranked in the UK top 10.

With the exception of Mid and East Antrim (+18%) all of the province’s economic regions recorded productivity below the UK average. Even Belfast was 0.5% below the UK average. Derry City and Strabane had the lowest productivity, 26% below the UK average.

The growth in hours worked between 2010 and 2018 in Belfast was 17%, beating Lisburn and Castlereagh which recorded 11%, Derry City/Strabane and Antrim/Newtownabbey were both on 9%. In UK terms this level of growth was in the top half of the country’s subregions. Mid and East Antrim saw productivity decline by 10%.

If the increase in economic output is also factored in then at the ‘sub regional’ level NI’s performance would rank in the UK top ten (mirroring Invest NI). Outer London – West and North West was best in the UK with growth of 12% with Inner London – East the worst in the UK at -10%. NI growth was 5%,

More data from the ONS showed unemployment in the country was 1,000 higher at 22,000 between November and January; the increase of 0.1% took the overall rate to 2.4%, the lowest in the UK. The NE had the highest rate at 6.2% with the UK rate at 3.9%.

The South East had the highest employment rate at 80% which compared with 72.3% in NI where 0.9m are employed; the UK rate was 76.5%.

NI’s  average property price increased by 0.2% to £140,190 in Q4 2019, which took the annual increase to 2.5%. In comparison, UK prices decreased by 1.1% to £231,185 during January, an annual growth rate of 1.3%.

NI growth slows and the Province slips down the rankings, a sharp contraction in productivity but the unemployment rate the best in the UK by some way

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For the 12 months ended December 2019, a nowcast published by the Economic Statistic Centre of Excellence (‘ESCoE’) on a rolling 4 quarter basis, has estimated that NI growth has fallen from 1.8% to 1.1%. ESCoE is a partnership of research institutions and the Office for National Statistics (‘ONS’).

This ranked the Province eighth (previous ranking second) and suggests the NI economy has not performed well relative to the other eleven parts of the UK. Over the same period UK growth was 1.4%; growth in London (ranked first) was 3.3%; and growth in the East Midlands (ranked twelfth) was 0.1%.

The latest official ONS figures for an earlier period are more mixed. Following its first publication of quarterly GDP estimates for the regions in September 2019, the ONS has now published its third estimate for the nine English regions and Wales. GDP figures have been available for the UK since the 1940s, for Scotland since 2002 and Northern Ireland since 2013.

These stats are for the period six months before the ESCoE estimates shown above and compare GDP in the quarter ended June 2019 with the same quarter a year earlier. These more volatile figures showed that NI grew by 1%, down from 1.3% growth the previous quarter. This placed the country fourth (previous ranking ninth) out of the twelve UK ‘regions.’

London topped the table with growth of 4.5% whilst UK growth over the same period was 1.4%. The NW was the worst performer and contracted by 0.7%, one of three ‘regions’ in the UK to suffer a decline.

In the same report, the ONS’s figures highlighted that the standalone quarter to June 2019 was slightly better for NI than the previous quarter. The Province’s economy grew by 0.4% in April to June 2019, following growth of 0.3% in January to March 2019.

This placed the country fifth (previous ranking sixth) out of the twelve UK ‘regions’. Six regions of the UK saw their economies contract as did the UK overall by 0.2%. The WM was the worst performer in Q2 with -1.6% whereas London was the best with +1%.

In this period, the Province’s services sector grew by 0.4%, production by 0.2% and the public sector by 0.1%. Construction was a drag at 0.3%.


Like most regions of the UK, output per hour in NI was below the UK average. Productivity in the Province was 15.6% under the norm which ranked the region tenth in the UK.

Two regions had productivity above the UK average in 2018, London +31.6% and the South East +9.1%. These regions record high levels of hours worked and their elevated productivity pulls up the UK average so much that all other regions fall below it. Wales was furthest off the average at -17.2%.

NI moved up the rankings to seventh in terms of output per job. This means that on average workers in NI worked longer hours for each job compared with the UK average. The region’s 11.4% below the UK average compared with London at 40.5% above.

In terms of growth in output per hour, six regions of the UK expanded. NI was ranked eleventh as output per hour contracted by 2.0%. At 2.3% growth was fastest in Scotland and the biggest contraction was in Yorkshire and the Humber at 2.5%. UK growth was 0.5%.

Sectorally, productivity in accommodation/service activities was better than expected but the deviation from forecasts in non-manufacturing and agriculture was a UK outlier.

On average, in 2018 the UK economy produced about £35 of value for each hour worked, with finance and insurance top at c£69 per hour compared with accommodation and service activities productivity at c£17 per hour.


More data from the ONS showed unemployment in NI fell by 1,000 to 21,000 between October and December; the drop of 0.1% moved the overall rate down to a record low of 2.4%, the lowest in the UK. The national rate was 3.8% with the highest rate at 6.1% which was recorded in the North East.

The South West had the highest employment rate at 80.1% which compared with 72.4% or 0.9m in employment in the Province; the UK rate was 76.5%.

In December, average earnings in NI fell by £5 to £537 per week. London had the highest average earnings of £805 and the lowest average earnings of £530 were recorded in the NE. NI was ranked eleventh (previous ranking also eleventh).

In the UK overall, average earnings grew by 2.9% or by 1.4% after inflation. After adjusting for inflation, regular pay is now at its highest level since 2000, whereas total pay (which includes bonuses) is still 3.7% below its peak in February 2008.


NI average property prices in Q4 2019 increased by 0.2% to £140.190; the uplift took the annual increase to 2.5%. In comparison, UK prices increased by 0.3% to £234,742 during September, an annual growth rate of 2.2%.

NI improves its fiscal deficit and boasts the lowest jobless rate in the UK but the economy stalls

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In the ONS’s estimate of regional public spending and regional tax revenues in 2019, NI had a deficit of £9.4bn, a smaller shortfall than the £9.7bn recorded in 2018. This compared with London, which had the highest surplus of £38.9bn.

On a per person basis, the NI deficit was £4,978, lower than the £5,169 recorded in 2018. London had the highest surplus of £4,369 per person whereas Northern Ireland had the biggest shortfall.

The only areas of the UK to run surpluses were London, the SE of England and the East of England. The West Midlands and the North East were the two regions in the UK to increase their net fiscal deficits over the year; the other seven regions reduced their shortfalls.

At a national level, the UK had a deficit of £623 per person which splits into deficits of £68, £2,713, £4,289 and £4,978 for England, Scotland, Wales and Northern Ireland respectively.

Public spending in NI was £27.9bn or £14,821 per head, an increase on the 2018 figure of £27.4bn. London had the biggest spend of £123.9bn or £13,826 per head whereas at £27.9bn Northern Ireland had the lowest. NI will receive a funding boost following the restoration of devolved government. Total government spending was £853bn or £12,835 per head.

NI collected £18.5bn in taxes in 2019. London contributed the most to the Exchequer at £161.9bn, compared with the lowest contribution which was from the Province. Overall the state raised £811.3bn or £12,213 per head in taxes, an uplift of £34.1bn or £461 per head compared with 2018.

More data from the ONS showed unemployment in NI fell by 5,000 to 21,000 between September and November 2019; the substantial drop of 0.6% took the overall rate to 2.3%, the lowest in the UK. The national rate is 3.8%.

The South West had the highest employment rate at 79.8% which compared with 72.6% in NI. UK employment was estimated at 76.3%.

NI average property prices increased by 2.3% during Q3 2019, the uplift to £139.951, increased annual growth to 4.0%. In comparison, UK prices increased by 0.4% to £235,298 an annual growth rate of 2.2%.

Figures from the official Northern Ireland Statistics and Research Agency showed output fell 0.1% over the quarter to September which meant the economy had expanded by 0.3% in the 12 months to September 2019.  The comparative UK figures for the same periods were 0.4% and 1.1%.

Over the quarter, construction was up by 0.2% but production fell by 0.4%. Overall the private sector was 0.3% smaller than earlier in the year.

The NI figure was poorer than the more volatile nowcast estimate from ESCoE in November. Part of the gap can be explained by slightly different methods of calculation but it is clear that the economic picture is deteriorating.

On development, listed Belfast-based IT firm Kainos has been valued at more than £1bn. Kainos specialises in digitalising its clients’ operations. Kainos employs 1,550 people across 12 offices and is planning to develop a new headquarters in Belfast over the next two years.

Planning has been approved for a new 276-bed hotel in the Titanic Quarter in Belfast. The hotel will be the third to open recently. A Premier Inn was part built as part of the first phase of the development and the boutique Titanic Hotel opened in 2017. The Titanic centre generates c£160m in economic benefit, in 2017 it had c770,000 visitors.

Coleraine-based Armstrong Medical is investing £8m in an expansion project which includes new machinery and a new 26,000 sq ft warehouse. The firm specialises in respiratory products for use in healthcare and exports to 60 countries. Invest NI has offered £800,000 to support the creation of 24 new jobs.

In Carrickfergus, Sensata Technologies is to close its factory with the loss of 270 jobs. The firm makes tyre pressure sensors and will wind down on a phased basis before closing in early 2021. The firm will retain its Antrim factory although some operational support roles there will also be cut.

East Belfast based Crane Stockham Valve, part of Connecticut-based Crane Co, is closing its factory next year, 63 jobs will be lost. The firm makes valves and pipe fittings. The NI operation has a total headcount of 89 of which some will move to a smaller office and others will be redeployed to other factories.

NI the only part of the UK to post negative growth in 2018, Mid and East Antrim sees the biggest decrease in GDP and Ards and North Down has the overall lowest, more recent data underpins the Province’s robust labour market

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Following its first publication of quarterly GDP estimates for the regions in September, the ONS has now published its 2018 full year estimate of economic activity by UK country, region and local area using gross domestic product.

The figures showed the NI economy contracted by 0.5% in 2018 down from growth of 1.7% in 2017. This placed NI 12th (2017 ranking sixth) out of the twelve UK ‘regions.’

The UK and England growth rate in 2018 was 1.4%. Scotland grew by 0.9% and Wales by 1.3%.

Within the Province, the Lisburn and Castlereagh economy grew the fastest at 4.8%, followed by Mid Ulster at 3.5% and Belfast at 0.9%. Across the UK, the highest annual growth of the 179 local areas was in Falkirk at 10.5%.

Eight areas of NI saw their GDP decline in 2018. Mid and East Antrim recorded the biggest drop in the UK at 10.1%, followed by Fermanagh and Omagh at 2.7% and Antrim at 2.5%.

GDP per head growth of 3.6% to £25,918 was seen in Lisburn and Castlereagh although at £44,332 Belfast was top. GDP per head fell by 10.5% in Mid and East Antrim to £29,885 but Ards and North Down was bottom in the Province (and UK) with £15,034.

In terms of UK extremes, GDP per head in Camden and the City of London was £395,309 with Ards and North Down one of three NI areas in the UK bottom ten. These figures are a guide and are influenced by commuter flows.

In 2018, key drivers of the NI economy were information and communication up 6.0%, arts/entertainment 4.4% and administrative support services 3.7%. Those areas that did not perform well were agriculture down 9.3%, public administration/defence 5.5% and finance and insurance declined by 4.9%. Overall the services shrank by 0.6%, construction fell by 5.4% and production dropped by 0.5%.

The 2018 performance of the Province’s development agency was also highlighted by the ONS. Of the UK’s 45 development bodies or economic regions, Greater Birmingham and Solihull LEP was ranked first in the UK with growth of 2.8%. Invest NI dropped down the rankings from 25th to 40th with negative growth of 0.5%. Tees Valley LEP was last with negative growth of 2.1%.

Recent data from the ONS is more positive. Unemployment in NI dropped by 5,000 to 20,000 between August and October 2019; the large drop of 0.6% took the overall rate to 2.3%, the lowest in the UK. The national rate is 3.8%. The highest rate was 6.1% which was recorded in the North East.

The South West had the highest employment rate at 80.8% which compared with 72.4% in NI. The UK rate was 76.2%.

UK property prices grew in only three parts of the country. Growth of 2.3% in NI during Q3 took prices to £139,951, an annual increase of 3.3%, the biggest uplift in the UK. In comparison, UK prices fell by 0.7% to £232,944, an annual growth rate of 0.7%.

The Northern Ireland economy ranked second in the UK, the unemployment rate the lowest in the UK, and house prices in the Province jump

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Northern Ireland public transport provider Translink, which oversees NI Railways, Ulsterbus and Metro, has appointed a contractor for the first phase of the new Belfast Transport Hub, which is likely to cost in the region of £200m.

The Weavers Cross project is an eight hectare development on the site of the existing Europa bus centre and Great Victoria Street train station. The Hub will be the main transport gateway to Belfast, with rail, bus and coach connections to all parts of Northern Ireland.

The project could create up to 400 jobs over the next five years with 100 jobs in the initial phase.

Also on employment, lorry trailer manufacturer SDC Trailers, is cutting an undetermined number of jobs across its plants in Toomebridge and Mansfield. The company was sold to Chinese group CIMC Vehicles in 2016 and employs 800 people – 650 in plants in Northern Ireland, with a further 150 in Nottinghamshire.

The new Hinch Distillery, which will produce whiskey and gin from a facility near Ballynahinch, will create 40 jobs. The project will include a visitor centre, restaurant, pub and event spaces and is being supported with a £1.9m taxpayer grant from Invest Northern Ireland.

In 2010 there were four distilleries in Ireland, now there are 24.

Northern Ireland Screen has also committed £218,000 of public money in production funding towards a simulation game, Paleo Pines, where players become dinosaur ranchers. The game is being developed by County Down game development studio, Italic Pig, and is likely to cost over £1m.

The Agency plans to spend about £300,000 per year on video game production funding until 2022, and a further £2.8m over the same period in development funding for Northern Ireland’s video game industry.  Having backed Game of Thrones, who would dare question the wisdom of the quango’s approach.

Spirit, the buyer of Bombardier’s Northern Ireland operations, has suggested it may try to renegotiate a £113m taxpayer loan advanced for the development of the wing factory for the CSeries passenger plane, later renamed the Airbus A220. A loan repayment is made every time an A220 is delivered to a customer.

The Stats

Following its first publication of quarterly GDP estimates for the regions in September, the ONS has now published its next estimates for Wales and the nine English regions, for the year to March 2019. GDP figures have been available for the UK since the 1940s, for Scotland since 2002 and Northern Ireland since 2013.

The latest comparable figures showed the NI economy grew by 1.3% compared with 1.8% in the year ended December 2018. This ranked the ‘region’ ninth (previously fifth) out of the twelve UK ‘regions’.

London topped the table with growth of 4.2% with Yorkshire and The Humber bottom at -0.3%. Propelled by a drive to meet the original March 31st Brexit date, UK growth over the same period was 2.2%.

The ONS figures also showed that the NI economy grew by 0.4% in the quarter to March 2019. This compared with growth of 0.2% in October to December 2018.

In this period, contributions came from the production sector (0.3%) and construction (0.1%) but the services sector contracted (0.2%).

Estimates published by ESCoE last month for the year ended September 2019, a more recent period than the ONS figures, ranked NI second (previous ranking last) with growth of 1.79%, which suggests the ‘region’ has had a better summer relative to other parts of the UK.

Using this metric, UK growth was 1.45%. Growth in London (ranked first) during this period was 2.32% compared with growth in the South West of England (bottom) at 0.41%

More data from the ONS showed that unemployment fell by 5,000 to 23,000 between July and September; the whopping decrease of 0.6% took the overall rate to 2.5%, the lowest in the UK, the UK rate was 3.8%. The highest rate was 5.9% which was recorded in the North East.

The South West had the highest employment rate at 81.0% which compared with 72.3% in NI; the UK rate was 76.0%. During the last recession the NI employment rate fell to 64%.

In September, average earnings in NI were down by £3 to £542 per week. The lowest earnings of £527 were in Wales. London had the highest average earnings of £830. In the UK overall, average earnings grew by 3.6% or by 1.8% after inflation.

NI average property prices increased by 2.3% (the biggest uplift in the UK) over the month to £139,951, which took the annual rise to 4.0% (also the best in the UK). In comparison, UK prices fell by 0.2% to £234,370 during September, an annual growth rate of 1.3%.

£163m of new growth deal funding used as an incentive to recall Stormont, and Wrightbus, Bombardier Belfast and Harland and Wolff are all bought

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Unemployment in NI decreased by 2,000 to 26,000 between June and August, the fall of 0.2% left the overall rate at a record low of 2.9%.

The South West of England continued to record the lowest rate at 2.4% with the UK rate at 3.9%. The highest rate was 5.8% which was recorded in the North East of England.

The South West also had the highest employment rate at 81.0% which compared with 71.5% in NI. UK employment was estimated at 75.9%.

NI average property prices increased by 0.8% to £168,221 in Q2, which took annual growth to 3.5%. In comparison, UK prices grew by 0.8% to £234,853 during August, an annual growth rate of 1.3%.

The ONS’s Personal Well-being (or Happiness) Index has ranked NI eleventh out of the 12 UK ‘regions’ in terms of improved happiness since the last survey. Overall though, the Northern Irish were still the happiest in the UK with Londoners still the most miserable.


In July, Boris Johnson Announced that £300m growth deals funding will be shared across Scotland, Wales and Northern Ireland.  NI Secretary Julian Smith has now said Northern Ireland is to benefit from £163m of this investment.

This money will only be available though if Stormont is operational.

Growth deals (also known as city deals in urban areas) are national, devolved and local government funding packages aimed at boosting regional economies, often by encouraging private investment in specific projects.

Belfast City Deal, which proposes to invest £350m into Belfast and six surrounding council areas, has already been agreed. In May, c £100m has been committed to boost the economy in the Derry and Strabane District Council area.

The new £163m will cover mid south west Northern Ireland and Causeway Coast & Glen. Council areas that will benefit include: Armagh City, Banbridge and Craigavon Borough Council; Fermanagh and Omagh District Council and Mid Ulster District Council.

Canada’s Bombardier has agreed to sell part of its business to, Kansas based, Spirit AeroSystems for more than £1bn in cash and debt. The deal includes the Belfast plant and facilities in Morocco and Dallas.

Spirit, is a major supplier to Airbus and Boeing. The wings for the Airbus A220 are made at the Belfast plant and it also supplies other Airbus parts.

The Belfast factory will continue to supply Bombardier’s business jet division. Bombardier employs about 3,600 people in Northern Ireland.

A vote of confidence in Londonderry from Manchester-based David Samuel Properties which has paid a reported £30m for The Crescent Link Retail Park.

This is the second biggest property deal in Northern Ireland this year after Citigroup bought its main Belfast premises from Titanic Quarter for £34m.


A deal in principle has been reached for the sale of Wrightbus.

Purchaser, Jo Bamford, son of JCB owner Lord Bamford, said agreement had been reached for the acquisition of the Wrightbus factory after an issue over adjacent farmland was resolved.

It now appears that the farmland will be gifted to the local council which could use it as an innovation project as part of the Belfast city deal in conjunction with Queens’ University.

Known for building the ‘Boris Bus,’ c1,200 Wrightbus workers were made redundant after the company entered administration. It is not known whether Invest NI has committed any public money to the latest deal.

The Agency disclosed it loaned the Wrightbus group £2.5m in June 2019 to keep the business afloat. The development agency will need to ensure that these funds are not classified as operating aid under state aid rules.

Also on the buses, Mallaghan Engineering in creating 60 jobs after securing a multi-million-pound contract to build a fleet of airport buses.

Ryanair has initially ordered a 32-strong fleet of the Mallaghan 50W airport bus, to be delivered in the next 12 months.

Belfast’s Harland and Wolff shipyard, best known for building the Titanic, has been bought for £6m by the London-based energy firm, InfraStrata.

The yard employed 120 before it went into administration in August and InfraStrata has said it will retain the 79 workers who are still employed there. The new owners will initially focus on metal fabrication for its energy projects one of which is a potential gas storage project at Islandmagee in County Antrim.

The yard is synonymous with the interventionist policies of the 1970s and is estimated to have soaked up over £1bn of taxpayers’ money.

American software firm, ESO, which is based in Texas, is to create 120 jobs highly paid in Belfast.

The company sells software tools and products to emergency services and hospitals in north America and is planning to establish an engineering centre in Belfast.

The new posts will be in software, engineering, HR, and operations. Invest NI has offered ESO £780,000 towards the inward investment win.

Finally, consultancy firm EY is creating 94 new jobs at its Belfast office to add to the 520 already employed in the city. The firm is recruiting technology specialists, robotics, AI engineers and data scientists as well more traditional audit and tax roles.

Northern Ireland carving out a niche in cyber security, the end of the road for Wrightbus and a ‘Boris Bridge’ to Galloway

Reading Time: 4 minutesIn his latest spending round (covering the next year), Chancellor, Sajid Javid, announced £13.8bn of extra revenue spending for public services across the UK. Under the Barnett formula, Northern Ireland’s share will amount to c£400m, a real increase of c2% according to the Northern Ireland Office. With no Stormont government, however, spending decisions regarding this new money will be made largely by civil servants.

The design and build of a new generation of Royal Navy frigates has been won by engineering firm Babcock. The £1.25bn contract for the five Type 31 ‘Lidl’ warships secures hundreds of jobs at yards across the UK. At £250m the Type 31 is a smaller, cheaper frigate than the Type 26 warships currently being built on the Clyde which are c£1bn each. The winning consortium also includes Harland and Wolff. The ships will be assembled in Rosyth, with construction work expected to be spread between the other UK yards like Belfast. Work is to begin by the end of 2019, with the first ships delivered in 2023.

Channel 4 News has seen documents showing that the Treasury and Department for Transport have been asked for advice on the possible costs and risks of a bridge from Northern Ireland to Scotland. Better infrastructure in Galloway suggests a bridge from Larne to Portpatrick is preferable to the shorter Antrim coast to Campbeltown crossing. At 20 miles long though, the Galloway option would cost much more, c£15-£20bn, but the region does have an existing trunk roads network from the Cairnryan ports to the motorway network. Another complication is the Beaufort’s Dyke, a deep trench where millions of tonnes of ordnance has been jettisoned. Where or who will foot the bill for this project is unclear. Last month, Transport Secretary, Grant Shapps, put the £80bn HS2 project under review.

A US cyber security firm, Contrast Security, is creating up to 120 jobs at a new Belfast office. The Californian company is establishing a development and delivery centre aided by a grant of £786,500 from Invest NI. The new jobs should offer an average salary of more than £30,000, reflecting the impact the cyber-security sector is having in NI where 1,700 professionals are now employed in the industry.

Another cyber security firm, MetaCompliance, is creating 70 jobs in Londonderry. The firm develops software that companies use to minimise risk from cyber attacks. Invest Northern Ireland has offered £695,000 towards the new roles and the £4.5m investment.

US engineering company, Terex Corporation, has opened a new factory near Londonderry, creating 100 jobs over the next four years. The new facility in Campsie is part of a £12m investment by Terex. The firm currently employs 1,500 people across eight sites in Northern Ireland. The factory will manufacture equipment used in waste management, mobile conveying and recycling at the new site.

The last UK-owned bus manufacturer Ballymena based, Wrightbus, has entered administration with the loss of 1200 jobs. Deloitte, the firm’s administrator, has been unable to find a buyer for the business and so just 50 jobs will be retained. Deloitte said the switch from diesel to electric buses caused a sharp decline in demand in the UK resulting in the firm’s cash flow problems. Invest NI has disclosed it loaned the Wrightbus group £2.5m in June 2019 to keep the business afloat. The development agency will need to ensure that these funds are not classified as operating aid under state aid rules.

Antrim-based contractor, Blackbourne, has ceased trading with the loss of c90 jobs. The company worked in mechanical/electrical engineering and contract maintenance. And in west Belfast, Caterpillar financial services is outsourcing its global finance operations to Accenture. Accenture does not have a finance operations in Northern Ireland so 100 jobs are at threat.

The Stats
For the first time, the ONS has published quarterly GDP for all nine English regions plus Wales. GDP figures have been available for the UK since the 1940s, for Scotland since 2002 and Northern Ireland since 2013. The Northern Ireland figures are compiled by the Northern Ireland Statistics and Research Agency. The latest available comparable figure, which are for the year ended 2018, showed Northern Ireland’s economy grew by 1.8%. This ranked the ‘region’ fifth of the twelve UK ‘regions.’ The East Midlands topped the table with growth of 3.4% whilst at the bottom the South West economy declined by 1.1%. UK growth over the same period was 1.5%. The quarter to Dec 2018 showed GDP was driven by a 0.5% increase in services but this was partially offset by decreases in production of 0.1% and construction of 0.3%. More recent estimates (six months later) for the year ended June 2019, published by ESCoE last month, ranked Northern Ireland bottom with growth of 1.0%, which suggests the Province’s economy has weakenend this year relative to other parts of the UK.

Unemployment in Northern Ireland decreased by 2,000 to 25,000 between May and July, the drop of 0.3%, took the overall rate to 2.8%, a record low. The South West had the lowest rate at 2.4% with the UK rate at 3.8%. The highest rate was 5.0% which was recorded in the North East. The South West also had the highest employment rate at 80.8% which compared with 72.0% in Northern Ireland . UK employment was estimated at 76.1%.

Northern Ireland’s average property price was £136.767 in June, which meant annually prices had risen by 3.5%. In comparison, UK prices grew by 0.5% to £232,710 during July, an annual growth rate of 0.7%.

Economic growth in Northern Ireland is the lowest in the UK but labour, earnings and house price data more encouraging, optimism at Harland and Wolff

Reading Time: 4 minutesGrowth in Northern Ireland was 1.0% in the year to June 2019, which ranked the country bottom in the UK according to estimates from ESCoE. The previous quarter’s growth was also around 1.0% which suggests the Northern Ireland economy is stalling at best. Of the twelve ‘regions’ of the UK, London had the best performance nationally at 2.3%; the national growth rate for the same period was 1.5%. With the UK economy contracting by 0.2% in the quarter, stalling growth in Northern Ireland suggests it is possible that over the quarter, the Province has outperformed other regional economies which have shrunk.

Unemployment in Northern Ireland increased by 2,000 to 28,000 between April and June, an uplift of 0.2% to 3.1%. The South West had the lowest unemployment rate at 2.7%, the North East had the highest at 5.3%, with the UK rate at 3.9%. The South West also had the highest employment rate at 80.5%, which compared with 72.2% in Northern Ireland; the UK rate at 76.1% is the joint highest since comparative records began in 1971.

In June, Northern Ireland’s average earnings increased from £513 to £545 per week. London had the highest average earnings of £831; the North East had the lowest at £537. In the UK average earnings grew by 3.7% or by 1.8% after inflation.

Northern Ireland’s average property price increased during the month, the 0.8% rise to £136,767 meant annually prices increased by 3.5%, the second best price growth in the UK. In comparison, UK prices grew by 0.7% to £230,292 during June, which left the annual growth rate unchanged at 0.9%.

Some interesting analysis by Northern Ireland’s Department for the Economy has suggested cutting air passenger duty (APD) would not deliver value for money. APD does not apply on long haul flights from NI but the DUP and airports have lobbied for it to be abolished altogether or at least cut on short haul. Civil servants and their consultants acknowledged that cutting the tax could help develop new air routes, but Northern Ireland’s block grant would be cut to reflect the reduced revenue going to the Treasury. An implicit subsidy to already commercially viable routes might also raise state aid problems. The report also recommended that the zero APD rate on long haul flights – initially aimed at supporting a direct service between Belfast and New York – be retained as an inducement to airlines, after United Airlines and Norwegian withdrew the only services on that route. Scotland and Wales use co-operative marketing arrangements – provided to Northern Ireland’s airports through Tourism Ireland – to attract long-haul services. The report suggests more investment in co-operative marketing via economic development and tourism agencies, airlines and airports jointly to promote and market new routes. Across the water, the Scottish Government has recently declined to abolish APD on environmental grounds, although Inverness airport remains exempt.

Net migration to Northern Ireland increased for the fifth year in a row and reached its highest level in 10 years last year according to the NI Statistics and Research Agency. The number of people coming to live in Northern Ireland was 23,000, while 19,000 people left, resulting in a net gain of 4,000. Belfast had the highest level of net international inward migration.

On jobs, Connex Offsite is to create 140 jobs over the next five years. The firm manufactures modular bathrooms which are installed in commercial developments like hotels and student accommodation. Also Chargifi, a provider of cloud-connected wireless charging technology, is to set up a hub in Belfast. The £3.6m investment will create 41 jobs. And Newry-based sandwich company Around Noon is creating 94 jobs in a £7m investment. The last two projects are being supported by c£1m of public funding via Invest NI. At Harland and Wolff, administrators say they have received a number of non-binding offers to buy the business as a going concern. The Belfast yard – which built the Titanic – employs c120 and was placed into administration earlier in the month.

A report by an All-Party Parliamentary Group (‘APPG’) of MPs which looks at Post-Brexit Funding for the nations and regions has found that the UK would receive additional EU funding in the 2021-27 spending round. Three additional sub-regions are likely to slip below the threshold of 75% EU average GDP per head that would qualify them for ‘less developed region’ status, but no part of Northern Ireland has yet fallen below this level.

Additionally, the EU has proposed that ‘transition region’ status should be extended to cover all regions with a GDP per head between 75 and 100 per cent of the EU average. Northern Ireland is classified as a transition region under the current 75-90 per cent rule. Seven additional sub-regions are likely to slip below the threshold of 100% EU average GDP per head, qualifying them for ‘transition region’ status. They are East Anglia, East Wales, Greater Manchester, Leicestershire, Rutland & Northamptonshire, Outer London South, North Yorkshire and South Western Scotland. It is not clear how much extra funding these areas would have received from the EU, but €50 per head over the next EU spending round would equate to c£560m.

The UK government has promised to replace EU funding to the regions with a new UK Shared Prosperity Fund. If the new sub regions are added, the APPG calculates this amounts to c£1.8bn pa, on top of the c£2.2bn pa already committed as part of Local Growth Funds (in England). Integrating the Local Growth Fund into the UK Shared Prosperity Fund could be problematic. The Local Growth Fund allocates funding to LEPs via competitive bidding whereas the allocation of EU funds uses a fixed formula. How the Shared Prosperity Fund will be allocated to Northern Ireland and the other devolved nations and mesh with other pots like the City Deals is yet to be determined.

Concerns over an iconic Northern Ireland firm and more growth deals announced

Reading Time: 3 minutesUnemployment in Northern Ireland increased by 1,000 to 28,000 between March and May, the uplift of 0.1% took the rate to 3.1%. At 2.6% the South West of England had the lowest rate and at 5.6% the North East had the highest rate in the country. The UK unemployment rate stands at 3.8%.

Northern Irish average property prices decreased by 1.0% to £134,811 during the first quarter which reduced the annual growth rate to 3.5%. In comparison, UK prices increased by 0.1% to £229,431 during May which reduced the annual growth rate to 1.2%.

On interventions, the new prime minister has announced six new growth deals, three in Scotland, two in Northern Ireland and one in Wales. The UK government said the allocation of the £300m pot would depend on the strength of the proposals put forward.

Growth deals (also known as city deals in urban areas) are national, devolved and local government funding packages aimed at boosting regional economies often by encouraging private investment on specific projects. Belfast City Deal, which proposes to invest £350m into Belfast and six surrounding council areas, has already been agreed. These new funds will cover mid south west Northern Ireland and Causeway Coast & Glen. They will also be used to complete a deal for Londonderry and the North West.

Devolved funding needs to be more transparent according to a report from the powerful Public Accounts Committee of the House of Commons (‘PAC’). Last year spending per head in Northern Ireland was highest at £11,190 per head, followed by Scotland at £10,881 per head and Wales at £10,307 per head with England was lowest at £9,080 per head. The Treasury allocates a block grant to each region and then uses the Barnett formula to flex the funding when there are changes to UK government spending that affect devolved services, aiming to give each country the same pounds-per-person change. On top of this the government can allocate additional funding outside Barnett for example on City Deals. The PAC claims that few taxpayers understand how the system works. The Committee also said the uncertainty caused by postponing the Spending Review was impacting on how the government will replace existing EU funding.

The iconic Harland and Wolff shipyard in Belfast – where the Titanic was built – is at imminent risk of closure according to unions who have called for it to be nationalised. A government spokesperson said the firm’s difficulties were a commercial issue and that it had no plans to intervene. The company’s Norwegian parent company, Dolphin Drilling, which has owned the yard since 1989, is having serious financial problems which led to it putting Harland and Wolff up for sale late last year. There were exclusive negotiations with a potential buyer but they appear to have ended in the last two weeks. The yard employs about 130 people, specialising in energy and marine engineering projects.

Also, in Ballymena, bus manufacturer Wrightbus has confirmed it is seeking an investor as it faces cashflow problems. The company has hired accountants Deloitte to find potential investors. The firm had two rounds of redundancies last year with 95 jobs going in February and June, it continues to employ about 1,400 staff in Northern Ireland. Demand for new buses in the UK market has dropped off following years of growth driven by new emissions targets.

Better news in East Belfast after Air France said it would buy 60 Airbus A220s, the wings of which are made in Northern Ireland. The airline has also taken an option which could see its order rise to 120. About 1,000 staff work at the A220 wing factory. The A220 was formerly the Bombardier C Series until Airbus bought a majority share in the project in 2017. Airbus said there is now an order book for 551 A220s.

Also on jobs, Lisburn-based firm, Creative Composites Ltd, is creating 132 jobs as part of an £11m expansion. The new jobs include production, engineering and managerial positions and are supported with £1.5m from Invest NI. The firm manufactures products for the car, rail and medical sectors. An expansion by Ballymoney-based construction firm Dowds Group is also being supported with an Invest NI employment grant of £442,000 which is tied to 68 new jobs. However, in Armagh, Linwoods is closing its Armagh bakery with the loss of 70 jobs.

Employment at a record high, Northern Ireland’s tourism strategy on track and the Derry City deal gathers momentum

Reading Time: 4 minutesUnemployment in Northern Ireland decreased by 3,000 to 28,000 between February and April, the drop of 0.4% to 3.1% was the joint best in the UK. The South West had the lowest rate in the UK at 2.7%; at 5.7% the North East had the highest. The UK unemployment rate stands at 3.8%.

The numbers employed grew by 2% to reach a new record high of 778,240. The private sector added more than 13,000 jobs over the year, an increase of 2.4% to 569,460 and in the public sector growth was 1% or to 208,480.

According to the latest figures from the ONS, Northern Ireland had the second lowest disposable household income in the UK between 2016 and 2017. The UK average is £19,514 per household with only England higher than this at £19,988; Scots had £18,099 of income whilst the Northern Irish narrowly beat the Welsh with £15,813 versus £15,754. Nottingham had the UK’s lowest gross disposable household income (wages or benefits) of £12,445 with London borough Kensington and Chelsea recording household income over £60,000 and a growth rate of 4.9% from the previous year. With inflation over the period at 2.6% the growth in Northern Ireland incomes of 1.0% suggests a decrease in disposable income in real terms.

The chair of the Industrial Strategy Council, Bank of England chief economist Andy Haldane, has said Northern Ireland needs to invest more in higher education as the Province’s universities are full which means productivity growth is being impeded. Northern Ireland’s productivity is consistently c15% below the UK average with the lowest proportion of the UK population with qualifications equivalent to A-Level or above. The Industrial Strategy Council is an independent body tasked with monitoring the government’s progress on the commitments made in its modern Industrial Strategy. The Industrial Strategy allows different regions of the UK to focus on their strengths but the lack of a Stormont government puts Northern Ireland at a disadvantage.

Tourism in Northern Ireland is a bright spot and is on track to meet the £1bn target by 2020 set by the last Stormont government. Estimated spending in 2018 was £968m across 5m overnight trips with The Giant’s Causeway, Titanic Belfast and the Ulster Museum the three most popular visitor attractions in 2018. Also a total of 128 cruise ships docked at ports in 2018, more than double the number in 2013. Spending by external tourists was estimated to be up 28% compared to 2013 which brought in £669m to Northern Ireland. New air routes, the relative weakness of sterling and the Game of Thrones effect meant 16% of visitors were foreign (non-UK and the Republic of Ireland).

On jobs, Japanese firm Mitsubishi Heavy Industries has agreed to buy Bombardier’s CRJ aircraft programme for £432m. Bombardier put its Northern Ireland operations up for sale last month. The fuselages of the CRJ planes are made at Bombardier’s Belfast plant employing c300 people.

Software firm Dynamic Signal is to create 100 jobs in Belfast. The company makes technology that enhances intra firm communications. Invest NI has tied in £650,000 towards creating the jobs and since the US firm only has seven staff in Belfast this almost qualifies as inward investment.

Another good win is technology company Futrli, which is creating 80 jobs in Belfast. The company uses artificial intelligence technology to manage data for small businesses and accountancy firms. Invest NI has offered £440,000 plus the Department for the Economy will provide £406,000 for training with Futrli investing £5.5m. The Brighton-based company has offices in Auckland, Sydney and Melbourne.

Visitors to Scottish distilleries may be soaring, but a project to open the first whiskey distillery in Derry – The Quiet Man at Ebrington – for nearly 200 years will not go ahead. The project stalled last year and now looks over after the company seeking to revive it notified the council. Work on a museum marking the city’s maritime history has also stalled with the lack of a Stormont government cited as a reason why. The museum will cost more than £11m of which c£4.5m has been committed by the council with a further £6.5m from Tourism NI, the NI Executive Office, and the Department for Communities pledged.

The distillery and museum are examples of why the redevelopment of the former 26-acre site military base at Ebrington is proceeding slowly, with just five of the 21 buildings occupied. The base closed in 2003 and was gifted to Derry by the MOD. The Peace Bridge opened in 2011 allowing people to walk from the city centre to the Waterside but the urban regeneration company tasked with the redevelopment closed in 2016, with the loss of 18 jobs. Plans are still in place for a hotel, office spaces, a restaurant and a café.

It is likely that some of the £105m of government funding announced last month in The Derry and Strabane City Deal could find its way to Ebrington. The city will receive £50m to support innovation and grow the area’s digital sector with a further £55m allocated to an Inclusive Future Fund aimed at tackling deprivation and developing young people’s skills. Derry City and Strabane District Council anticipates the total investment will be £300m if it is complemented by the Northern Ireland government and the private sector. The City Deal plans include the establishment of a riverfront university medical education and innovation hub which would create 200 new research posts and increase Ulster University numbers in the city by 2,000. City of Derry Airport is outlined in the deal as are proposals that include improvements to the region’s digital connectivity, the creation of skills academies and the creation of a Centre for Industrial Digitisation, Robotics and Automation.