Recent Bank of England analysis shows the real performance of the Northern Ireland economy since the economic crisis of 2008.
The narrative around the Northern Ireland economy in recent times has been one of recovery and yet the hard data shows that there has been no recovery. Data from the Bank of England at the end of June showed that in terms of real GDP [Gross Domestic Product] per capita since 2007 represented a fall for all regions in 2008-2009 and then a recovery thereafter for only two UK regions, London and the South East. For Northern Ireland GDP per head remains at 11 per cent below its pre-crisis peak. This performance is particularly poor when the fact that incomes in Northern Ireland are 18 per cent lower than the UK average [source Bank of England].
As the local economy has flat-lined since 2009 with no sign of recovery it is now faced with the challenge of Brexit. The only data available since the referendum vote has been the Purchasing Managers’ Index (PMI) survey by Ulster Bank which suggested that both output and new orders experienced decline in July. The survey showed business activity in Northern Ireland declining for the first time in 15 months. Respondents to the survey primarily attributed lower activity to uncertainty caused by the result of the EU referendum.
The Executive’s economic strategy to rebalance and grow the economy has had little impact over the period since 2008. The lack of recovery places the local economy in a particularly precarious position as the UK enters a period of unprecedented economic uncertainty.