Ulster Bank Northern Ireland Purchasing Managers Index (PMI) slidepack, December 2015. Includes analysis of Global, Eurozone, UK, UK Regions, NI & Republic of Ireland economic performance by sector

1. Ulster Bank Northern Ireland
Purchasing Managers Index (PMI)
Includes analysis of Global, Eurozone, UK, UK Regions, NI &
Republic of Ireland economic performance by sector
December 2015 Survey Update
Issued 11th January 2016
Richard Ramsey
Chief Economist Northern Ireland
www.ulstereconomix.com
richard.ramsey@ulsterbankcm.com
Twitter @UB_Economics

2. PMI Surveys
Purchasing Managers’ Indexes (PMIs) are monthly surveys of private sector companies
which provide an advance indication of what is happening in the private sector economy
by tracking variables such as output, new orders, employment and prices across different
sectors.
Index numbers are calculated from the percentages of respondents reporting an
improvement, no change or decline on the previous month. These indices vary from 0 to
100 with readings of 50.0 signalling no change on the previous month. Readings above
50.0 signal an increase or improvement; readings below 50.0 signal a decline or
deterioration. The greater the divergence from 50.0 the greater the rate of change
(expansion or contraction). The indices are seasonally adjusted to take into consideration
expected variations for the time of year, such as summer shutdowns or holidays.
< 50.0 = Contraction 50.0 = No Change > 50.0 = Expansion
Data at a sector level are more volatile and 3-month moving averages have been used to
more accurately identify the broad trends.

3. Global output growth eases to a 12-month low with
both services & manufacturing slowing in December

4. Composite PMIs for China & the US (Markit PMI not ISM)
both posted notable declines in December

5. Developed Markets PMI slips to an 11-month low (53.8)
but continues to outperform Emerging Markets (49.5)

6. Emerging Markets PMI back below 50 but only just. India,
bucks the wider trend being followed by its fellow BRICS

7. Chinese Composite PMI back below 50 and at a 21-month
low with slowdown spreading to services (17-mth low)

8. Australia’s services sector hits a 13-month low while
manufacturing eases from its recent 25-month high

9. Italy posts its highest reading since February 2011 with
France slipping to an 11-month low

10. EZ manufacturing & services continue to post output
growth but retail & construction activity still contracting

11. The Eurozone composite PMI signals a loss of
momentum in Q3 but some improvement in Q4

12. The Republic of Ireland, Germany, the UK & Italy posted
the fastest rates of service sector output growth

13. Manufacturing activity picked-up in EZ, with Japan
maintaining its growth rate. US & China still contracting

14. Developed Markets continue to outperform Emerging
Markets in terms of manufacturing

15. UK & RoI manufacturing output growth still ranks higher
than most with NI in the bottom half of the table

16. UK, NI and RoI firms all report an easing in their
respective rates of business growth in December

17. PMI suggests growth in DFP’s private sector composite index during
2014 but recovery stalls in Q1-15 with a modest rebound in Q2 to Q4

18. 2014 was the 1st year in 7 years that the 4 main indicators
recorded expansion, repeated in 2015 but growth slowed

19. New orders growth slows in Q4 but output growth rate
maintained with exports & jobs growth accelerating

20. NI firms reported an easing in the rate of output & jobs
growth in December but a slight pick-up in orders growth

21. NI firms report a pick-up in new orders growth in
December but still lag way behind the UK & RoI

22. Backlogs of work continue to grow amongst RoI firms
with levels of outstanding work for NI & UK firms flat

23. Northern Ireland export orders rebound in December

24. RoI jobs growth continues but eases to a 23-month low.
Employment growth for NI & UK eases slightly

25. PMI signalled a slowdown in jobs growth in H2-14 but
employment growth has accelerated since then

26. Input cost inflation hit its highest rate for the year in
December with output prices broadly flat

27. Regional
Comparisons

28. All UK regions end 2015 in expansion mode but only
just for Scotland

29. All UK regions posted growth in Q4 with Scotland’s
growth rate marginal. NI still lagging behind the UK

30. The RoI reported the fastest rate of growth in business
activity in 2015 with NI & Scotland the slowest

31. Scotland posts a fall in employment levels in December
with NI’s rate of job creation broadly in line with the UK

32. Scotland and the North East post the weakest rates of
job creation within the UK in Q4

33. Scotland, the North East & NI posted the weakest rates of
jobs growth over the last year with the RoI the strongest

34. Sectoral
Comparisons

35. UK construction industry was the only sector to post
an acceleration in output growth in December

36. The UK’s growth rate in Q3 moderated in line with the
PMI to 0.4% q/q. A slight improvement is expected in Q4

37. Manufacturing & construction output growth picks up in
December while services activity slows from recent high

38. Retail & construction posted stronger rates of growth in H2
than H1 while services held steady & manufacturing slowed

39. NI manufacturing output flat, services output slowing
but construction firms post a pick-up in output growth

40. Jobs growth within the services & construction sectors
accelerates while manufacturing industry is losing jobs

41. NI’s manufacturing firms report a rebound in output &
orders in December but pace of job losses accelerates

42. RoI & NI firms post a sharp slowdown in output growth
in Q4 with UK firms recording a pick-up in activity

43. NI firms report a marked divergence in manufacturing
orders growth than their equivalents in the UK & RoI

44. All economies saw an acceleration in output growth in
December with Greece & NI back above 50

45. Higher wage costs are driving input costs higher with
output price deflation continuing

46. NI manufacturing firms now reporting job losses at their
fastest pace in 2½ years. UK & RoI are still creating jobs

47. NI PMI signals moderation in jobs growth in H2-14 & Q1-15
following record high in Q2-14. Job losses apparent in Q4

48. NI services sector experiences a pick-up in new orders
& employment growth but output growth eases

49. NI diverges from the UK & RoI with firms reporting a
slowdown in service sector output growth

50. The rate of growth in NI’s services sector slows and
remains well below the pre-downturn long-term average

51. RoI firms still report very strong rates of new orders
growth whilst growth amongst NI & UK firms lags behind

52. Input cost & output price inflation accelerate with
output prices rising at their fastest rate since Sept-08

53. NI firms report a marked acceleration in jobs growth in
Q4 which is now in line with the UK but well below RoI

54. Pace of job creation within services sector eased in H2-
14 but has picked up and accelerated throughout 2015

55. NI retailers report a modest fall in sales and a notable
decline in orders but pace of jobs growth accelerates

56. NI retailers report output price deflation with output
prices recently falling at their fastest rate since June 2009

57. NI’s construction firms report rising rates of output, orders
& employment growth but activity largely linked to GB

58. Input cost inflation remains subdued as local firms
continue to enjoy pricing power

59. NI’s construction PMI posts jobs growth Q3-13 to
Q4-15 with a dip in employment in Q3-15

60. UK & RoI firms reporting strong rates of output growth
with NI firms catching up

61. New orders growth accelerating in the UK, RoI and NI

62. UK firms report a slowdown in the rate of growth in civil
engineering & housing activity with commercial holding up

63. UK sub-contractors remain in short-supply with rates
charged still rising albeit the pace of change is slowing

64. Optimism amongst UK construction firms remains high

65. All aspects of RoI construction activity have reported
a pick-up in their growth rates in recent months

66. RoI’s construction industry still reporting a decrease in
the availability of sub-contractors & rising rates of pay

67. RoI construction firms still remain very optimistic
about the year ahead

68. Slide 68
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