Quarterly Economic Survey

Q4 2022

General Business Performance

•Continued weakness in trade performance and challenges from ongoing inflationary pressures but no strong signs of further deterioration in Q4 2022

•Marginally more businesses reported increased domestic (UK) sales in the last 3 months (28%) compared to those reporting a fall (26%)

•However, more businesses are reporting that orders for the next 3 months have fallen, 29% compared to 24% reporting stronger order books.

•Just over 1 in 2 businesses (55%) are operating below capacity

•More businesses are experiencing declining international sales than those reporting growth

•More businesses are positive about turnover growth in the next 12 months. 47% expect turnover to grow, while 27% expect decline.

•Recruitment difficulties persist, with 87% finding it difficult to get staff

•Rising labour costs have become a much more significant concern. For 79%, this is feeding into expectations to raise prices.

•Inflationary pressures dominate concerns, with 85% of members increasingly concerned about its impact.

•Still significant pressure to raise prices, affecting 75% of members

Brexit Watch

14%49%

Most businesses have adapted to EU Exit. 14% continue to find it challenging, down from 36% in Q4 21.

49% of members believe NI Protocol issues can be resolved in 2023, up from 39% in Q4 2021.

Energy Costs

More businesses are experiencing rising energy costs

4 in 5

4 in 5 businesses (78%) are experiencing cost increases in excess of 30%

Trading Conditions Business Prospects Economy Prospects

Fewer businesses are trading well compared to last year. 31% are trading well in Q4 2022, compared to 40% in Q4 2021

55%

31% 18%

2 in 3 members are seeing a slowdown in demand in Q4, at 64% up from 61% in Q3 and 55% in Q2 2022

55% believe their business will grow in 2023 (70% in 2022) while 33% believe their business will contract.

Members are pessimistic around prospects for the NI economy in 2023

2 in 3 68% believe the NI economy will grow in 2023 (58% post COVID) believe the NI economy will contract

The share of members expecting the NI economy to decline is as high as that reported during COVID