The Northern Ireland Composite Economic Index (NICEI) Quarter 1 2022 was published today by the Northern Ireland Statistics & Research Agency (NISRA).
The key points were:
NI Economic output increased over the quarter, year, 3 year and rolling four quarters
- The NICEI indicates that economic output increased by 0.4 per cent over the quarter to March 2022 and by 7.8 per cent over the year to March 2022
- Where annual growth in the NICEI appears particularly strong, it is important to recognise there has been some volatility in the NICEI during the COVID-19 pandemic. As lockdown measures were introduced to mitigate the spread of COVID-19 and subsequently eased, this lead to the NICEI falling to a series low in Q2 2020, followed by the highest quarterly increase in the NICEI to Q3 2020.
- As a result, it is perhaps worth considering triennial change, comparing the change over three years i.e. Quarter 1 2022 and Quarter 1 2019 (the corresponding Quarter 1 before the pandemic) as opposed to annual change in order to mitigate any volatility arising from the pandemic in the NICEI. In terms of triennial change, NI economic output has increased at a slower rate (4.8 per cent) compared to the annual change (7.8 per cent) in the NICEI to Q1 2022. Furthermore, in Quarter 1 2022, NI Economic Output reached an almost 15 year high, returning to levels of economic output last exceeded in Q2 2007.
- The increase in the NICEI over the latest quarter (0.4 per cent) was largely driven by increased activity in the Service Sector which had a positive contribution of 0.4 percentage points (pps). The Public Sector and Production sector also had positive contributions with 0.2 pps and 0.1 pps. In contrast, the Construction sector had a negative contribution of 0.3 pps.
NI Economic Activity increased at a faster rate compared to UK GDP over the 3 year period
- Although the measures are not produced on a fully equivalent basis, comparisons with the UK show that NI Economic Activity increased at a faster rate than UK GDP triennially (i.e. over 3 years, 4.8 per cent vs 1.3 per cent). However, UK GDP grew at a faster rate than the NICEI over the quarter (0.4 per cent for NI vs 0.8 per cent for the UK), over the year (7.8 per cent for NI and 8.7 per cent for the UK) and rolling annual average (10.0 per cent for NI and 11.2 per cent for the UK).
Both the Public and Private sectors increased over the quarter, year, 3 year and rolling four quarters
- NI’s Private sector output as measured by the NICEI increased over the quarter (0.3 per cent), over the year (9.2 per cent) and on a triennial basis (4.5 per cent). Meanwhile, the NICEI Public Sector index also increased over the quarter (0.8 per cent), over the year (2.8 per cent) and on a triennial basis (5.4 per cent).
- For the Private sector, average growth for the four quarters to Quarter 1 2022 compared to the previous four quarters increased by 12.5 per cent. Whilst the Public sector (employee jobs) index increased by 1.9 per cent over the same period.
- The NICEI indicates the increase in economic growth over the quarter, year, 3 year and rolling annual average to Quarter 1 2022 was largely driven by increased activity in the Services Sector.
- The Index of Services (with Services accounting for 53 per cent of NI GVA) reached its series high in Q1 2022 - exceeding the previous series high achieved in the previous quarter, Q4 2021. It is also worth noting that in Q1 2022 both the Production and Public Sectors made a positive contribution to NICEI growth over the quarter, year, triennial and rolling four quarter period. In contrast, the Construction Sector experienced a reduction in output over the quarter and year to Q1 2022. In addition, Construction Sector output remained flat (i.e. 0.0 pps) over the 3 years to Q1 2022.
- The fact that the Services sector has reached a series high and is the main driver of change in the NICEI has lead the NICEI and Private Sector Component Indices to reach an almost 15 year high in Q3 2021, returning to levels of output last exceeded in Q2 2007.
- There has been a general relaxing of restrictions from Q2 2021 through to Q1 2022, with restrictions having been generally removed at time of writing. Economic activity had increased gradually in recent years (2013-2019) following the prolonged downturn post 2007. Recently the NICEI and Private Sector Component Indices have recovered from their respective series lows in Q2 2020 (which coincided with a period of strict lockdown restrictions) and have returned to levels of economic output last exceeded in Q2 2007 and Q3 2007 respectively
- The level of economic activity in NI currently sits 0.1 per cent below the maximum value recorded in Quarter 2 2007 whilst UK GDP is estimated to be 16.4 per cent above its pre-economic downturn peak recorded in Quarter 1 2008
Notes to editors:
1. The statistical bulletin and associated tables are available at the NI Composite Economic Index page on the NISRA website.
2. The NISRA Northern Ireland Composite Economic Index (NICEI) is a quarterly measure of the performance of the Northern Ireland (NI) economy based on available official statistics.
3. The NICEI combines existing published quarterly indices (i.e. Index of Services (IOS), Index of Production (IOP), Quarterly Construction Enquiry (QCE)), public sector employee jobs data from the Quarterly Employment Survey (QES), and unpublished agricultural output data from the Department of Agriculture, Environment and Rural Affairs (DAERA). These indices are weighted using ONS Regional Accounts Gross Value Added (GVA) data to provide a proxy measure of total economic output in the NI economy on a quarterly basis.
4. The NICEI output measures relate to the first quarter (January - March) of 2022. 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.
5. The NICEI back series is calculated each quarter, typically the revisions to the NICEI are reasonably minor. The revisions this quarter were more noticeable, further information is available in the detailed statistical bulletin available on the NI composite economic index (NISRA).
6. This report will be of interest to Ministers, policy makers, public bodies, the business community, banks, economic commentators, academics and the general public with an interest in the local economy.
7. Further information and tables from each of the data sources are available on the NISRA website.
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