Construction activity in Northern Ireland contracted in July.
Ulster Bank’s Purchasing Managers Index for Commercial Activity pegged construction activity at 48.9, down from 51 in June. Any number below 50 indicates contraction in activity, while a number above 50 indicates growth.
Northern Ireland Ulster Bank chief economist Richard Ramsey said the construction industry in Northern Ireland had “seen its performance reversed”.
The reasons for the negative performance of the construction business were cited as sharp cost increases and supply chain difficulties. The index shows a “drop in confidence” in the construction industry.
“Production, new orders and employment in the construction industry all contracted in July with very significant rates of decline in inbound labor and staffing levels,” Ramsey said. He predicted that, based on PMI trends, construction activity would be lower in 12 months.
The construction industry saw the biggest increase in input prices at 92.7, but other sectors – manufacturing, retail and services – were not far behind, touching the 90s. But these three -There saw growth continue in July. “Three of the four major sectors have seen their activity grow, led by the manufacturing sector. Construction was the only category to experience a decline in activity, ”the report notes.
In the broader UK context for July 2021, Ulster Bank private sector inflation rates in Northern Ireland were higher than in any other region in the UK.
Last month, it was reported that delays in delivery times were exacerbating the shortage of materials. This has been attributed to the red tape and bureaucracy surrounding the Brexit formalities. As part of the Brexit deal, the UK and the EU negotiated the Northern Ireland Protocol, which kept Northern Ireland within the EU’s single goods market.