Output in the sector covering hospitality in the Northern Ireland economy is now 7 per cent above pre-pandemic levels, surpassing growth in the UK as a whole, a report has said.
The Northern Ireland index of services (IoS), published by the NI Statistics & Research Agency (Nisra), said services output was now soaring 7 per cent above quarter four of 2019.
And the production sector closed out 2023 on a high with an increase of 0.4 per cent at the tail-end of the year, although it suffered a year on year decline of 3.3 per cent.
The rate of growth since 2019 in services, which accounts for around half of the Northern Ireland economy, was much stronger than the 3.3 per cent expansion UK-wide over the period.
As well as hospitality, under the term ‘accommodation and food,’ the services sector covers wholesale and retail; repair of motor vehicles and motorcycles; transport, storage, information and communications and business services and finance.
However, services recorded a fall in output of 0.3 per cent in the final three months of 2023 – a period including December’s four days of public transport strikes in Northern Ireland. But year on year, output had increased by 1.9 per cent.
In the UK, output in services had decreased by 0.2 per cent over the quarter and over the year.
And while output surged in the Northern Ireland services sector since the pandemic, the retail sector remains 6.3 per cent below its pre-pandemic level, possibly because habits of online shopping adopted during lockdowns remain entrenched.
Retail output, a sub-sector of the index of services, also declined 0.7 per cent between October and December, although it grew 0.6 per cent over the year.
Within services, the only sub-sector to show an increase in its output in the final quarter of the year was business services and finance, with output up 1.4 per cent.
And over the year, the increase in Northern Ireland services output of nearly 2 per cent was largely driven by growth of just under 9 per cent in the business services and finance sector. Its output was also 29 per cent above pre-pandemic levels.
Compared to pre-pandemic levels, the index of production is only 1.1 per cent above the pre-pandemic level of quarter four 2019 – though the UK’s index of production is 8.7 per cent below its pre-pandemic point.
Production’s output growth of 0.4 per cent at the end of the year was driven by 0.7 per cent increases in manufacturing, 3.3 per cent growth in mining and quarrying. That was off-set by a 0.1 per cent drop in electricity, gas, steam and air conditioning supply, and a drop in 1.2 per cent in water supply, sewerage and waste management.
But the 3.3 per cent year on year slump was driven by slumps across all four sectors, with the steepest decline of 4.7 per cent hitting the mining and quarrying sector.
A fuller picture of the performance of the Northern Ireland economy, including the public sector, for the final quarter of 2023 will emerge when the NI Composite Economic Index (NICEI) is published at the end of March. However, the NICEI for the third quarter showed an increase of 0.6 per cent. It is an approximate equivalent to the economic measure of GDP, used to measure performance of larger economies.
A contraction in GDP in the UK in the third and fourth quarters of 2023 meant it had technically entered recession. However, figures this week from the Office for National Statistics (ONS) said the UK economy had expanded 0.2 per cent in January.
Source: Belfast Telegraph (link opens in new window)