NI service sector grows as manufacturing declines

Northern Ireland’s services and manufacturing sectors continue to show contrasting performances, official data suggests.

Manufacturing output was down by 1.1% in the second quarter of this year, the eighth consecutive quarter of decline.

Meanwhile, service output grew by 0.4% in the same period to reach a record high.

Business services and finance continued to drive growth with a quarterly expansion of 2.9%.

That sector has grown by more than 33% compared to its pre-pandemic level seen in the final quarter of 2019.

That is much faster than overall economic growth, which suggests it reflects the work that Northern Ireland-based employees are doing for GB and international customers.

Northern Ireland has some significant back office operations for global finance and professional service firms.

The largest domestic-focused service sector, retail and hospitality, saw output fall by 0.1% over the quarter.

The weakness was likely to be concentrated in retail as separate figures show retail sales fell by 0.6%.

Within manufacturing, there were differences between subsectors with quarterly growth in food and pharmaceuticals.

The largest subsector, engineering and allied industries, saw output continue to decline and is now back to a level seen in the middle of 2022.

In July, one of NI’s biggest engineering employers, Terex, said it was planning to cut around 100 jobs.

It said an “extraordinary surge in demand” for its products in the aftermath of the coronavirus pandemic had now "stabilised".

Manufacturing has also suffered from the impact of energy prices and global supply chain disruptions.