Northern Ireland’s slow economic recovery continued during the first quarter of the year bolstered by improved domestic and UK sales in both the manufacturing and services sectors.
But new industry research released on Tuesday also shows business confidence levels are falling and the uncertainty surrounding exchange rate movements are a growing concern.
The latest quarterly economic survey – compiled by the Northern Ireland Chamber of Commerce and Industry (NI Chamber) and business advisers BDO – highlights that more local business are worried about exchange rate fluctuations than they were two years ago.
The results of the survey – carried out against a backdrop of major job loss announcements during quarter one – suggests that while the local manufacturing sector increased their sales and enjoyed a slight increase in export orders during the first quarter general indicators were less than positive.
According to the NI chamber fewer businesses in either manufacturing or the services sectors recruited more staff during the first quarter of 2016.
Local manufacturing firms also reported that confidence levels, investment intentions and employment expectations fell over the quarter.
Fewer manufacturers also reported that they were operating at full capacity.
The services sector also outlined that overall the domestic sales order book was far from healthy and export sales and order balances “negative” – in comparison to the general picture across the UK its performance was deemed “generally weak”.
Ann McGregor, chief executive of the NI chamber said that while there were some positives to emerge from quarter one there remained “considerable challenges” that need to be addressed in the North and that among the business community “the sense of uncertainty is palpable”.
She said chamber members would like to see the Northern Ireland Executive establish a new “taskforce” from the private sector that could devise a “positive plan” to help manufacturing businesses and specifically tackle issues like high energy costs.
According to the latest survey one in four Chamber members believe that the introduction of a reduced rate of corporation tax is the most important intervention that the NI Executive can effect to support local businesses and grow the Northern Ireland economy.
The chamber says some members would like the introduction of the lower rate to be brought forward but many members have also expressed concerns that it might not be implemented at all.
When it comes to the Brexit debate in the North the survey also highlights that many local businesses want to remain in the European Union.
