Output from Northern Ireland’s service sector fell slightly in the third quarter of 2008 and was also down over the year. Production output was flat over the quarter but up over the year.
The number of people claiming unemployment related benefits increased by 1,800 during the latest month to 35,900 in December 2008. This was smaller than the monthly increase in November 2008 (3,100). However, the December increase resulted in the largest annual increase (12,200) in over 37 years (since January 1971). Most of the annual increase has occurred in the last six months with the number of claimants having increased by 10,000 since June 2008.
The Construction industry accounted for 44% of the rise in claimants in December, indicating that job losses continue to be more widely spread among other sectors this month. The number of unemployed claimants in Northern Ireland in December 2008 (35,900) was about the same as the level reported some six and a half years ago (35,600 in August 2002).
The Northern Ireland seasonally adjusted unemployment rate1 was estimated at 4.2% for the period September - November 2008. This was essentially unchanged from the rate of 4.3% recorded in both the last quarter and in the same period one year ago. The Northern Ireland unemployment rate remained below the UK average (6.1%) and was also lower than the European Union (7.1%) and Republic of Ireland (7.1%) rates for October 2008.
The seasonally adjusted number of working age persons that were economically inactive increased by 6,000 over the quarter. The corresponding working age economic inactivity rate increased to 27.2%. The Northern Ireland rate remained considerably higher than the UK average rate (20.8%) and was the highest of the UK regions.
Seasonally adjusted estimates for the same period showed that there were 783,000 people in employment in Northern Ireland. This represented a fall of 0.6% in employment levels over the quarter, but a slight rise of 0.1% over the year.
Commenting on the figures, Enterprise Minister, Arlene Foster said: "We are continuing to see rising numbers of unemployment benefit claimants, reflecting the continuing impact of the economic downturn. There has been an increase of 10,000 over the last six months, including an additional 1,800 over the month to December 2008. This has been a rapid change over a relatively short period of time and there is still a degree of uncertainty about the severity and potential duration of the downturn.
“While the challenging economic conditions are a global phenomenon, we shouldn’t forget that this is a difficult time for the individuals and families concerned.
“Despite their severity, these conditions are not unique to Northern Ireland and we must continue to focus on the longer term goal of building a strong economy.”
Provisional seasonally adjusted estimates from the Index of Production (IOP) for the third quarter of 2008 showed that output from the production industries remained constant in real terms (0.0%) over the quarter. Compared to the same quarter one year earlier, overall output had risen by 3.9%. Production over the last four quarters increased by 4.1% when compared to the previous four quarters.
The UK reported falls in production output of 1.5% over the quarter and 2.6% over the year. Production over the last four quarters in the UK fell by 0.5% when compared to the previous four quarters.
Over the quarter the sectors that displayed the greatest declines were Non-metallic Mineral Products (down 10.5%) and Machinery and Equipment (down 7.1%). However, the Food, Drink and Tobacco sector (up 6.2%) continued to report growth. This growth has been the main factor in keeping production output constant over the quarter.
Provisional seasonally adjusted estimates from the experimental Index of Services (IOS) for the third quarter of 2008 showed that the service sector had decreased by 0.3% over the quarter and by 3.5% compared to the same quarter one year earlier. This was the fifth consecutive quarter in which service sector output had fallen. The decrease in Northern Ireland services over the last four quarters (-2.2%) compared with an increase of 2.4% for the UK as a whole.
Over the quarter, the largest contribution to the fall in the Index was driven by the following sub sectors: Business Services & Finance (-3.8%), Distribution - Wholesale & Retail (-1.6%), Transport Storage & Communication (-1.6%) and Hotels & Restaurants (-1.1%). Over the same period the Other Services sector (3.4%) reported an increase.
Reflecting on the Index of Production and Index of Services, Arlene Foster said: “This was the fifth consecutive quarter in which we have seen a decline in business activity in private sector services. Most of this has been driven by falling sales in the Business Services & Finance and Wholesale & Retail Sectors during the third quarter of the year.
“The lack of consumer confidence is undoubtedly contributing to poor retail sales, but the attractive sterling exchange rate may provide stimulus for some pockets of the Northern Ireland retail sector. The ongoing uncertainty in financial markets has also contributed to a heightened sense of caution in the wider business community.
“The output of the Production industries was flat over the quarter but increased over the year. This highlights the importance of ensuring that we have high quality products and services for export to global markets. There is still evidence of high quality, innovative companies doing well in current conditions. This approach should be applied across local businesses to ensure they are best placed to take advantage of the eventual economic up-turn.”
Notes to Editors:
1. The official measure of unemployment is sourced to the Labour Force Survey (LFS) and refers to people without a job who were available for work and had either looked for work in the four weeks prior to interview or were waiting to start a job they had already obtained. This definition is consistent with that recommended by the International Labour Office. Unemployment estimates for the European Union and the Republic of Ireland are sourced to EUROSTAT.
2. The figures released today contain data from a number of different sources. The unemployment, employment and economic inactivity rates are sourced to the LFS and refer to the period September to November 2008. It should be noted that the LFS figures are estimates, which are subject to sampling error. This means that the exact figure is likely to be contained in a range surrounding the estimate quoted. For example, the exact number of unemployed persons is 95% likely to fall within +/- 8,000 of the quoted estimate.
3. The Claimant Count measure of unemployment relates to December 2008 and is based on claimant data from Jobs and Benefits Office Administrative Systems.
4. Not all those who register for unemployment benefits meet the criteria for LFS unemployment. Conversely, not all those defined as unemployed in the LFS are eligible for unemployment benefits. Estimates of the numbers unemployed may also differ between the two sources due to timing differences.
5. The Production and Service Sector Output measures relate to the 3rd quarter (July-September) of 2008. These estimates are based on surveys of businesses and estimates of change are subject to sampling error. Figures for a quarter may be revised if more complete information subsequently becomes available.
6. The ‘Other Services Sector’ includes - Education, Health and Social Work and Other Community, Social and Personal Services activities.
7. Details of sampling errors, together with more detailed statistical information and definitions of the methodology used, can be found in the Labour Market Report (LMR), Index of Production and Index of Services bulletins, which are available online
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8. For media enquiries, please contact DETI Press Office on 028 9052 9297. Outside office hours, please contact the Duty Press Officer via pager number 07699 715 440 and your call will be returned.
9. General information can be obtained from Martin Monaghan, DETI Statistics Research Branch, on Tel: 028 9052 9421.
