NI Firms Confident in Growth for Year Ahead

20th Jun 2007

Northern Ireland small and medium sized enterprises are more confident about prospects for their business in the coming year than counterparts in the Republic, a new industry barometer reveals. The first Ulster Bank Business Confidence Survey, which researched the views and expectations of businesses with up to 100 employees across the island, shows that 63 per cent of Northern Ireland companies expect to do better (40 per cent) or much better (23 per cent) in the next 12 months. This compared to 51 per cent in the Republic who expect to do better (39 per cent) or much better (12 per cent).

Looking further ahead, 77 per cent of Northern Ireland firms said that they intend to grow their business in the next two to three years. This compared to 70 per cent in the Republic.

With regard to current business conditions in Northern Ireland, more than one third of firms said that they were better (26 per cent) or much better (11 per cent) than the same time last year, with 31 per cent reporting that they remained the same.

Alan Stewart, Head of Business Banking NI at Ulster Bank, says that greater investment to increase innovation and workforce skills will be one of the pillars of continued business expansion in Northern Ireland.

Northern Irelands private sector has grown consistently in the last two years, despite the widely acknowledged structural weaknesses inherent within the economy, and this survey shows that on the whole small and medium sized firms, which are the bedrock of the economy, are confident that they can continue to develop and improve their business, he says.

Clearly recent political progress and increasing social stability are helping fuel optimism in business prospects and will support ongoing economic expansion. However, the burgeoning spirit of enterprise increasingly evident amongst Northern Ireland firms must continue to be fostered, and investment in research and development and in building innovation capacity must increase. The outcome of Sir David Varneys review of taxation policy in the autumn will also be central to mid to long-term economic prospects, Mr Stewart continues.

This survey offers a valuable insight into the experiences, expectations and intentions of business owners and entrepreneurs across the island and provides a clear picture that businesses on both sides of the border intend to hire more staff and expand their operations, Mr Stewart adds.

The survey also indicated considerable improvement in business performance from 12 months previous. 54 per cent of Northern Ireland businesses said that they were doing better (31 per cent) or much better (23 per cent) now compared to a year ago. This compared to 38 per cent in the Republic who said they were performing better (28 per cent) or much better (10 per cent).

28 per cent of Northern Ireland firms interviewed said that they now employ more people than they did last year. 46 per cent said that they employ the same number and only 6 per cent said that they employ fewer.

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Notes to Editors

About the Survey

The Ulster Bank Business Confidence survey was conducted in April 2007. A total of 937 telephone interviews was conducted with business owners or business managers of companies with up to 100 employees. Regional quotas were imposed in order to ensure sufficient sample within all 9 regions.

Firms from across a range of business sectors were interviewed including: production, construction, wholesale/retail, hotels/restaurants, transport/storage/communication and financial/other business services.

The survey was conducted by independent researcher Amrach Consulting.