Summary of data
Labour Market
- Employment Rate, 71.5 per cent, Down over the quarter, Down over the year
- Unemployment Rate, 2.9 per cent, Up over the quarter, Unchanged over the year
- Inactivity Rate, 26.3 per cent, Down over the quarter, Unchanged over the year
Source: Northern Ireland Statistics and Research Agency (NISRA)
Index of Production
- Output down 22.2 per cent over the year
Index of Services
- Output down 23.5 per cent over the year
Source: NISRA
Exports
- £9.1 billion goods exported
- £3.2 billion Exports to the Republic of Ireland
Source: HMRC
PMI
- Business Activity increased but softened
- Fall in business sentiment
- Sixth month of employee jobs decreasing
- 19 months of decline in new export orders
Source: Ulster Bank
DfE Monthly Economic Summary - September 2020
While the OECD Interim Economic Outlook projections remain subject to considerable uncertainty due to the coronavirus outbreak, with the easing of lockdown in recent months, forecasts have generally been revised upwards compared to its June Economic Outlook. However, global GDP is still projected to drop by 4.5 per cent this year, while GDP in the Euro Area and the UK are forecast to decline by 7.9 per cent and 10.1 per cent respectively in 2020.
The impact of COVID-19 on the Northern Ireland labour market is further reflected in the latest Labour Force Survey estimates. The number of people claiming unemployment benefits increased by 800 from August’s revised figure to approximately 62,700 in September, making it the fourth month that the claimant count was above 60,000. There were 9,160 proposed redundancies in the 12 months to August 2020, more than double the number recorded in the previous 12 months and the highest annual total on record. A further 880 redundancies have been proposed between 1 and 14 September. The number of confirmed redundancies (3,880) in the 12 months to August 2020 was also more than double the previous year, with confirmation of 820 redundancies in August 2020.
The unemployment rate for May-July 2020 increased by 0.6 percentage points over the quarter to 2.9 per cent, reflecting the first statistically significant quarterly increase in the unemployment rate since October 2012. The NI rate was below the UK (4.1 per cent), RoI (5.3 per cent) and the EU (6.7 per cent) rates. At the same time, the inactivity rate fell over the quarter but rose over the year (0.4pps) to 26.3 per cent. While the employment rate decreased over the quarter and over the year to 71.5 per cent, it remains relatively high. However, within those included in the employed total, 19 per cent were temporarily away from work and average weekly hours worked was estimated at 28.1 hours, down 5.5 hours over the year and one of the lowest average weekly hours worked on record.
The latest Quarterly Employment Survey jobs estimates include those who are furloughed under the Coronavirus Job Retention Scheme. The number of employee jobs in June 2020 was estimated at 779,880. This was a decrease of 1,540 jobs (-0.2 per cent) over the quarter but an increase of 4,570 jobs (0.6 per cent) over the year; the first quarterly decrease since December 2015. Quarterly decreases in employees were seen within the manufacturing, construction and services sectors to June 2020. ‘Other industries’ was the only sector which recorded a rise this quarter with a peak in June 2020 of 24,610 jobs.
The latest results from the Ulster Bank PMI reported growth in the local private sector for the second month running in August, although the rate of expansion softened amid signs of stalling in new orders. There remained further evidence of spare capacity, with a further reduction in backlogs of work and a sharper reduction in employment. Business sentiment in August was slightly below that seen in July, with Northern Ireland again being the only UK region to signal a negative outlook. The lasting impacts of the COVID-19 pandemic were central to pessimism, while Brexit was also a factor. The rate of cost inflation quickened, but firms lowered their selling prices to try and attract new business.
According to NISRA’s latest House Price Index, house prices increased by 0.3% this quarter (April – June 2020). Over the year from Q2 2019 – Q2 2020 house prices increased by 3 per cent. The House Price Index is now 27.2 per cent higher than Q1 2015. The average price for a house in Northern Ireland is £141,131.
NISRA’s latest Index of Production (IOP) has decreased by 14.9 per cent over the quarter and by 22.2 per cent over the year to a series low and 13.8 per cent below its previous series low. This quarterly decrease is the largest quarterly change in the history of the NI IOP (since Q1 2005). The UK IOP reported a decrease in output over both the quarter and the year by 16.9 per cent and 18.8 per cent respectively, also to a series low.
The Index of Services (IOS) shows that output has decreased over the quarter and over the year by 17.7 per cent and 23.5 per cent respectively. The UK IOS reported similar decreases over both the quarter and year, by 19.9 per cent and 21.2 per cent respectively. The NI Index is at its lowest point since the series began (Q1 2005), with NI services output 24.5 per cent lower than its highest point in Q4 2006.
In the year to June 2020, the value of NI goods exports (based on HMRC Regional Trade Statistics) was £8.3bn, a decrease of 10.1 per cent over the year. The largest markets for NI exports were the EU (£4.9bn, with £3.0bn of that to the RoI) and the USA (£1.0bn).
Prepared by DfE Analytical Services Division September 2020 analyticalservices@economy-ni.gov.uk