Northern Ireland Labour Market Update
Issued 23rd December 2013
Richard Ramsey
Chief Economist Northern Ireland
Twitter: @UB_Economics
ContentsSlide Numbers
1. Labour Market Summary 3-4
2. Workforce Jobs – (including NI & UK comparisons) 5-9
2 . NI Quarterly Employment Survey – (including sector performance) 10-20
3. NI’s Job Losses, Recovery & Current Position - (including sector performance) 21-24
4. NI’s ‘Employment Recessions’ & Recoveries Compared 1980s v 1990s v 2007/08 - 2013 (includes sector performance) 25-29
5. NI Public & Private Sector Employee Performance 30-35
6. NI v UK Employee Job Performance - (including sector performance) 36-45
7. NI v UK Full-Time & Part-Time Employment Performance 46-58
8. Ulster Bank PMI Employment Performance 59-70
9. Unemployment Trends (includes claimant count & Labour Force Survey) 71-86
10. Earnings (includes analysis from NI Annual Survey of Hours & Earnings 2013) 87-94
NI Labour Market Summary (1)NI’s total workforce jobs increased by 0.7%, or +5,300 jobs, over the year to June 2013. This took the total number of workforce jobs (includes employees & self employed) to 808,900 jobs in June 2013. This is 49,300 (-5.7%) below NI’s peak in June 2008. By comparison, UK workforce jobs in June 2013 were just 0.1% below their pre-downturn peak.
NI recorded its 7th consecutive quarterly rise in Q3 2013 according to the latest Quarterly Employment Survey (QES). There were 3,300 jobs created in Q3 alone and a cumulative net gain of 11,400 jobs during the last 7 quarters. The latter represents over one quarter of the jobs lost during the downturn.
All NI sectors posted employment growth in Q3 2013 with construction posting only its 2nd quarterly gain since Q4 2007. Despite this increase, NI’s construction employment remains almost 37% below its pre-downturn peak. Construction / property related sectors have posted the steepest job losses over the last 5 years.
Full-time employees have borne the brunt of the job losses in the UK, NI and the Republic of Ireland (RoI). However, all three economies saw the rate of job creation accelerate in Q3 2013. The RoI and the UK posted year-on-year increases of 3.8% and 2.2% respectively. Meanwhile full-time employment in NI increased by 8,810, or 2.3%, over the year to Q3 2013. This represented the fastest rate of employment growth since Q1 2008. Despite this recent rise, the number of full-time jobs in NI in Q3 2013 remains 4.3% (or 20,410 jobs) below the corresponding figure in Q3 2008 and 5.5% (26,530) below the peak recorded in Q1 2008.
The Ulster Bank PMI suggests that NI will record further employment growth, across all sectors, in Q4 2013.
NI’s claimant count, or dole queue, fell for the 10th successive month in November 2013 to 60,200. This represents acumulative fall of 4,700 relative to NI’s claimant count peak of 64,900 in January 2013.
NI has the highest claimant count unemployment rate of all the UK regions at 6.7% (UK = 3.8%). The NI-UK unemployment differential (2.9 percentage points) is now wider than it was when the Good Friday Agreement was signed back in April 1998.
NI Labour Market Summary (2)
Using the ILO unemployment measure, NI’s unemployment rate in the three months to October 2013 stood at 7.5%. This compares with 12.7% for the Republic of Ireland and 7.4% for the UK. NI’s relatively low ILO unemployment rate, when comparing with the UK average, is due to the high levels of economic inactivity. NI continues to have the highest rates of economic inactivity within the UK (27.4%). This has the effect of lowering NI’s headline unemployment rate as there is ‘hidden unemployment’ within the economically inactive. Furthermore, at 67.0%, NI has the lowest employment rate of all the UK regions (UK = 72.0%).
Using the ILO unemployment measure it is noted that NI has the 2nd highest rate of youth unemployment (after London) within the UK. NI’s unemployment rate for 18-24year-olds currently stands at 23.8%. This compares with 18.6% for the UK as a whole. NI’s youth unemployment rate is more than twice the rate that prevailed when the Good Friday Agreement was signed.
NI has the lowest median gross annual earnings of all the UK regions. According to the latest Annual Survey of Hours and Earnings 2013, NI’s gross annual earnings for all full-time employees stood at £23,904. This was some 11.5% lower than the UK average of just over £27,000. NI’s low annual earnings are due to below average earnings within the private sector.
NI’s gross weekly earnings for full time employees within the private sector are some 18% below the equivalent figure in the UK.
Since the Good Friday Agreement was signed in April 1998, the gap between the NI-UK median wages for full-time employees has narrowed for women but widened for men.
The rate of inflation has outpaced earnings growth for most individuals since the recession began in 2008. After inflation, the median private sector wage for all employees (full-time & part-time) has fallen by almost 20%. Meanwhile the corresponding figure for the public sector has increased by almost 6%.
Those individuals aged under 40 years have experienced the biggest falls in real earnings between 2008-2013.
Workforce JobsEmployee Jobs + Government Supported
Trainees + Self-employed
49,300 fewer workforce jobs in June 2013 relative to June 2008 – a fall of 5.7%
NI Workforce in Employment Jobs (Employee Jobs + Self Employment + Govt supported trainees)
808.9k858.2k
803.6k
500,000
550,000
600,000
650,000
700,000
750,000
800,000
850,000
900,000
1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013
Source: DFP, jobs in June of each year
14,200 fewer self-employed jobs in June 2013 relative to June 2008 – a fall of 11.6%
NI Self-Employment Jobs
108k
122.2k
50,000
60,000
70,000
80,000
90,000
100,000
110,000
120,000
130,000
140,000
150,000
1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013
Source: DFP, jobs in June of each year
NI has not experienced the jobs recovery that has occurred within the UK but is now playing catch-up
NI & UK Workforce Jobs Annual % Growth
-6%
-4%
-2%
0%
2%
4%
6%
1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013
Y/Y
NI UK
Source: DFP & NOMIS, jobs in June of each year
UK workforce jobs are just 0.1% below their June 2008 peak whereas NI is 5.7% below its pre-downturn peak
NI & UK Workforce Jobs (as of June 2013)
-7%
-6%
-5%
-4%
-3%
-2%
-1%
0%
1%
2%
3%
June 2008 Peak to Trough Recovery from Trough Net Position Relative toJune 2008 Peak
NI UK
Source: DFP & NOMIS, June annual figures
Quarterly Employment Survey (QES)
QES is an employer survey (@ 5,500 companies) that measures the actual number of jobs (employees in
employment) as opposed to the number of individuals in employment (as in the Labour Force Survey). The QES
excludes the self-employed but is the preferred measure of employment within Northern Ireland
Summary Table – Quarterly Employment SurveyConstruction Services Manufacturing Total Public* Private*
2007 Q1 43,460 567,160 83,870 715,550 220,250 495,180
Q2 44,710 571,080 84,070 720,760 220,730 500,310
Q3 45,320 575,090 83,940 725,420 219,370 506,240
Q4 46,820 578,880 83,470 729,340 219,780 509,100
2008 Q1 45,860 582,950 83,750 732,690 219,880 512,820
Q2 44,860 584,490 83,350 733,070 218,440 515,020
Q3 43,500 581,240 82,220 727,400 216,100 511,290
Q4 41,670 579,540 80,130 721,370 224,100 496,970
2009 Q1 39,420 577,730 78,230 715,340 224,460 490,920
Q2 38,210 577,080 75,290 710,490 225,030 485,690
Q3 36,780 577,450 74,010 708,030 225,390 482,510
DISCONTINUITY IN DATA SERIES
Q4 37,120 580,970 73,330 711,250 225,010 486,100
2010 Q1 36,960 579,810 73,150 709,760 223,560 486,340,Q2 36,200 579,080 73,030 707,930 221,790 486,290
Q3 35,790 576,250 72,930 704,770 219,630 484,920
Q4 33,610 573,540 73,850 700,830 219,330 481,470
2011 Q1 33,370 573,340 73,690 700,250 216,810 480,510
Q2 32,780 570,770 73,430 697,240 216,810 480,510,Q3 32,930 569,060 73,750 695,750 215,340 480,150
Q4 31,640 564,690 75,490 691,620 214,090 477,560
2012 Q1 31,480 565,630 74,820 691,750 214,430 477,490
Q2 31,360 566,100 75,240 693,320 213,830 479,530
Q3 31,020 567,840 74,990 694,390 214,030 480,070
Q4 29,820 569,960 74,340 694,720 214,500 480,270
2013 Q1 29,630 570,840 74,470 695,440 214,680 480,880
Q2 29,400 574,030 75,670 699,720 215,170 484,530
Q3 29,720 576,230 76,370 703,020 215,130 487,640
Latest Quarter Q/Q % Change 1.1% 0.4% 0.9% 0.5% 0.0% 0.6%
Latest Quarter Y/Y % Change ‐4.2% 1.5% 1.8% 1.2% 0.5% 1.6%
Fall from peak ‐ Nos ‐17,100 ‐8,260 ‐7,700 ‐30,050 ‐5,600 ‐27,380
Fall from peak % Change ‐36.5% ‐1.4% ‐9.2% ‐4.1% ‐2.5% ‐5.3%
Northern Ireland Employees Jobs (Seasonally Adjusted)
DISCONTINUITY IN DATA SERIES↓ New Series ↓
Source: DFP, *Public & Private splits may not sum to total,** includes transfer of part‐nationalised financial institutions from private to public sector. Peak to trough fall does not strictly use comparable data and is indicative only
DISCONTINUITY IN DATA SERIES↑ Old Series ↑
↓ New Series ↓
↑ Old Series ↑↑ Old Series ↑
↓ New Series ↓
NI posts its second largest quarterly increase (+3,300) in over 5 years (Q4 2009 represents start of new series & therefore not a Q/Q rise)
NI Employee Jobs Quarterly ChangeExcludes self-employed
-8000
-6000
-4000
-2000
0
2000
4000
6000
Q3 2006 Q1 2008 Q3 2009 Q3 2010 Q1 2012 Q3 2013
Nos
Source: DFP
Discontinuity in Series
25,040
19,630
+11,400
NI posts its 7th consecutive quarterly rise in Q3 2013 of 0.5% or 3,300 jobs (Q4 2009 represents start of new series & therefore not a Q/Q rise)
NI Employee Jobs Excludes Self-Employed
-1.0%-0.8%-0.6%-0.4%-0.2%0.0%0.2%0.4%0.6%0.8%1.0%
Q32006
Q22007
Q12008
Q42008
Q32009
Q42009
Q32010
Q22011
Q12012
Q42012
Q32013
Q/Q % Change
-4%
-3%
-2%
-1%
0%
1%
2%
3%Y/Y % Change
Q/Q Y/Y
Source: DFP
Discontinuity in Series
Current employment levels back at late-2005 levels
Northern Ireland Employee Jobs
703,020
613,250 Q2 1998
733,070
500,000
550,000
600,000
650,000
700,000
750,000
Q3 1993 Q3 1997 Q3 2001 Q3 2005 Q3 2009 Q3 2013
Source: DFP
Discontinuity in Series
Service sector posts its 7th consecutive quarterly rise
NI Services Employee Jobs Quarterly ChangeExcludes self-employed
+11,540
-8,000
-6,000
-4,000
-2,000
0
2,000
4,000
6,000
Q22007
Q12008
Q42008
Q32009
Q42009
Q32010
Q22011
Q12012
Q42012
Q32013
Nos
Source: DFP
Discontinuity in Series
-7,410-16,280
Service sector employment is back to late-2007 levels
Northern Ireland Services Employee Jobs
574,030
Q2 1998454,990
584,490
375,000
425,000
475,000
525,000
575,000
625,000
Q3 1993 Q3 1997 Q3 2001 Q3 2005 Q3 2009 Q3 2013
Source: DFP
Discontinuity in Series
Manufacturing employment posts its third successive quarterly increase 0.9% q/q (700 jobs) in Q3 2013
NI Manufacturing Employee Jobs Quarterly Change (Excludes self-employed)
-3,000
-2,500-2,000-1,500
-1,000-500
0
5001,0001,500
2,000
Q22007
Q12008
Q42008
Q32009
Q42009
Q32010
Q22011
Q12012
Q42012
Q32013
Nos
Source: DFP
Discontinuity in Series
-9,740
Manufacturing employment is now at its highest level since Q1 2009 after the long-term trend of job losses
NI Manufacturing Employee Jobs Levels
84,070Q2 2007
76,370
104,940 (Q3 1998 just after GFA)
50,000
60,000
70,000
80,000
90,000
100,000
110,000
120,000
Q3 1993 Q3 1997 Q3 2001 Q3 2005 Q3 2009 Q3 2013
Source: DFP
Discontinuity in Series
Construction sector posts only its second quarter of employment growth since Q4 2007
NI Construction Employee Jobs Quarterly Change (Excludes self-employed)
-2,500
-2,000
-1,500
-1,000
-500
0
500
1,000
1,500
2,000
Q3 200
7Q1 2
008
Q3 200
8Q1 2
009
Q3 200
9
Q1 201
0Q3 2
010
Q1 201
1Q3 2
011
Q1 201
2Q3 2
012
Q3 201
3Q3 2
013
Nos
Source: DFP
Discontinuity in Series
-10,040+320
Construction employment back to Good Friday Agreement (1998) levels
NI Construction Employee Jobs Levels
29,720
46,820
20,000
25,000
30,000
35,000
40,000
45,000
50,000
Q3 1993 Q3 1997 Q3 2001 Q3 2005 Q3 2009 Q3 2013
Source: DFP, QES
Discontinuity in Series
Back to 1998 levels
Northern Ireland’s Job losses, recovery and
current (net) position 2007/08-2013
All sectors have now shown some signs of recovery
Northern Ireland Employment (Employee Jobs)
-40%
-30%
-20%
-10%
0%
10%
All Sectors Services Manufacturing Construction
Peak to Trough Recovery from Trough Q3 2013 Relative to Peak
Source: DFP, QES
Utilities post largest annual % gain over the last year whilst construction records the biggest decline
Construction / property related
Construction / property related
Utilities, Admin, Manufacturing, ICT & tourism related sectors
Broad Industrial Group Net Job Change % Change
Year‐on‐Year Risers
Electricity, gas, steam & air conditioning supply 180 12.6%
Administrative & support service activities 2,850 6.8%
Professional, scientific & technical activities 1,570 6.6%
Information & communication 940 5.9%
Real estate activities 300 4.2%
Human health & social work activities 2,360 2.0%
Manufacturing 1,390 1.8%
Accomodation & food service activities 700 1.7%
Transport & storage 160 0.7%
Other service activities 90 0.7%
Wholesale & retail trade; repair of motor vehicles 780 0.6%
Agriculture, forestry & fishing 10 0.1%
Mining & quarrying 0 0.0%
Year‐on‐Year Fallers
Public administration & defence; social security ‐130 ‐0.2%
Arts, entertainment & recreation ‐40 ‐0.3%
Education ‐260 ‐0.4%
Water supply, sewerage, waste management ‐40 ‐0.8%
Financial & insurance activities ‐730 ‐3.8%
Construction ‐1,300 ‐4.2%
Total 8,810 1.3%
Source: DFP ‐ Quarterly Employment Survey (Seasonally Unadjusted), Excludes self‐employed
Northern Ireland Employment Change (Ranked by % change)September 2012 ‐ September 2013
↓↓↓
↑↑↑
Utilities, Admin, Manufacturing, ICT & tourism related sectors
Property related sectors & manufacturing have seen the biggest job losses over the last 5 years
Construction / property related
Construction / property related
Utilities, Real Estate,
Entertainment & Agriculture
Broad Industrial Group Net Job Change % Change
Year‐on‐Year Risers
Electricity, gas, steam & air conditioning supply 420 35.3%
Real estate activities 1,010 15.6%
Arts, entertainment & recreation 1,290 9.3%
Professional, scientific & technical activities 1,440 6.0%
Agriculture, forestry & fishing 560 4.6%
Human health & social work activities 3,750 3.3%
Administrative & support service activities 1,260 2.9%
Information & communication 430 2.6%
Other service activities 140 1.0%
Year‐on‐Year Fallers
Education ‐440 ‐0.7%
Accomodation & food service activities ‐840 ‐1.9%
Public administration & defence; social security ‐2,680 ‐4.6%
Wholesale & retail trade; repair of motor vehicles ‐6,110 ‐4.7%
Transport & storage ‐1,280 ‐5.0%
Water supply, sewerage, waste management ‐250 ‐5.1%
Manufacturing ‐5,930 ‐7.2%
Financial & insurance activities ‐1,830 ‐9.1%
Mining & quarrying ‐470 ‐22.0%
Construction ‐13,780 ‐31.7%
Total ‐23,340 ‐3.2%
Source: DFP ‐ Quarterly Employment Survey (Seasonally Unadjusted), Excludes self‐employed
Northern Ireland Employment Change (Ranked by % change)September 2008 ‐ September 2013
↑↑↑
↓↓↓
Utilities, Real Estate,
Entertainment & Agriculture
Northern Ireland’s ‘Employment Recessions’ & Recoveries Compared
1980s
1990s
2008-2013
Job losses in the latest downturn not as steep as the 1980s. But returning to peak is likely to take longer than 1980s (10yrs)
NI Employee Jobs Recessions / Recoveries Pre-Recession Peaks Indexed = 100
1980s10yrs after downturn
employment returns to peak
1990s10yrs after peak employment
rose by 19%
80
85
90
95
100
105
110
115
120
125
Peak 1 year 2yrs 3yrs 4yrs 5yrs 6yrs 7yrs 8yrs 9yrs 10yrsTime Since Pre-Recession Peak
Index
1980s 1990s 2008-2013
2008-20135 years (21 quarters) after 2008 Q2 peak NI jobs
are still 4.1% lower as of Q2 2013
Employment troughed (-7.5%)13 quarters after 1979 Q4 peak & was 5.9% below peak after 21 quarters
(just over 5 years)
In 1990 UK recession, NI employment fell slightly & troughed 2 years after the pre-
recession peak
Source: DFP & UB Calculations
Manufacturing job losses have been nowhere near what they were like in the 1980s but recovery may be similar
NI Manufacturing Recessions & Recoveries in Employee Jobs (Pre-Recession Peaks Indexed = 100)
employment was 27% lower >6 years after Q2 1979 peak
0.7% below Q3 1990 peak after >6 years (25 quarters)
>6 years (25 Quarters) after Q2 2007 peak employment
is 9% lower
65
70
75
80
85
90
95
100
105
Peak 1 year 2yrs 3yrs 4yrs 5yrs 6yrs 7yrs 8yrs 9yrs 10yrsTime Since Pre-Recession Peak
Index
1980s 1990s 2007-2013
Source: DFP & UB Calculations
In terms of job losses, construction has experienced its fastest & deepest recession on record
NI Construction Recessions & Recoveries Compared (Employee Jobs Pre-Recession Peaks Indexed = 100)
Peak 1979 Q2
Peak 1990 Q3
2007Q4 - 2013 Q3
50
60
70
80
90
100
110
120
130
Peak 1 year 2yrs 3yrs 4yrs 5yrs 6yrs 7yrs 8yrs 9yrs 10yrsTime Since Pre-Recession Peak
Index
1980s 1990s 2007- 2013
Source: DFP & UB calculations
Current recession has seen construction employment plummet. Almost 6 years (23 quarters) after the downturn employment was still 36% below Q4 2007 peak. At this stage of the 1980s
recession employment had fallen by just 26%
Service sector jobs recovery underway. However, it remains the slowest and weakest recovery to date
NI Service Sector Recoveries in Employee JobsPre-Recession Peaks Indexed = 100
+15% rise in 10 years
+27% rise in 10yrs
Peak Q1 2008 - Q3 2013
80
85
90
95
100
105
110
115
120
125
130
Peak 1 year 2yrs 3yrs 4yrs 5yrs 6yrs 7yrs 8yrs 9yrs 10yrsTime Since Pre-Recession Peak
Index
1980s 1990s 2008-2013
This is the weakest & slowest service sector recovery. 21 quarters on employment still 1.4% below peak
1990s: NI lacked a developed private services sector which explains lack of job
losses in early 1990s UK recession
Source: DFP & UB Calculations
1980s: 21 quarters after employment peak service sector employment was 4% above
pre-recession peak
NI Public Sector v Private Sector Employment Levels
& Growth
Headline public & private sector growth rates are misleading due to reclassification of some institutions as public sector
NI Public & Private Sector Employment Growth
-6%
-4%
-2%
0%
2%
4%
6%
Q31993
Q31995
Q31997
Q31999
Q32001
Q32003
Q32005
Q32007
Q32009
Q32011
Q32013
Public Private
Source: DFP
Job gains exaggerated as @5k jobs in financial institutions
reclassified as public sector
Job losses exaggerated as @5k jobs in financial institutions moved
from private to public sector
Both public & private sector employment levels are higher in Q3 2013 than they were last year
NI Public v Private Sector Employment Growth
-6%
-4%
-2%
0%
2%
4%
6%
Q31993
Q31995
Q31997
Q31999
Q32001
Q32003
Q32005
Q32007
Q32009
Q32011
Q32013
Public* (excluding financial institutions)Private* (incl. part-nationalised institutions)
Source: DFP, *Ulster Bank estimates
Return of private sector jobs
growth
Private sector employment growth has risen in each of the last 6 quarters but is still at mid-2006 levels
NI Private Sector Employee Jobs
487,640
515,020
491,640
325,000
350,000
375,000
400,000
425,000
450,000
475,000
500,000
525,000
550,000
Q3 1993 Q3 1997 Q3 2001 Q3 2005 Q3 2009 Q3 2013
Private Sector Unadjusted for Financial Institutions reclassification
Private Sector Adjusted (incl. part-nationalised institutions)
Source: DFP & UB estimates
Good Friday Agreement
Signed April 1998418,170 Q2 1998
Public sector employment boom has been & gone. A period of job losses (attrition & non-replacement) is anticipated
NI Public Sector Employee Jobs Levels
Good Friday Agreement April 1998
195,120 Q2 98
Pre-recession peak Q4 2005221,040
215,130
211,130
180,000
190,000
200,000
210,000
220,000
230,000
Q31993
Q31995
Q31997
Q31999
Q32001
Q32003
Q32005
Q32007
Q32009
Q32011
Q32013
Public Unadjusted Public Adjusted* (excl. financial institutions)
Source: DFP, * UB estimates
Public sector employment boosted by @5k in Q4 2008 as
part-nationalised financial institutions reclassified as public sector. Public sector
jobs (excl. financial institutions) now estimated at @211k or
2003 levels.
+26,000 jobs (13%) in 7yrs
post GFA
Private sector employment remains an estimated 4.5% since peak with public sector down an estimated 3.4%
NI Public & Private Sector Employment % Change Q2 2008 - Q3 2013
-8%
-7%
-6%
-5%
-4%
-3%
-2%
-1%
0%
Headline Public Sector Headline PrivateSector
Public Sector*(excl.part-nationalisedfinancial institutions)
Private Sector* (incl.part-nationalised
financial institutions)
Source: DFP & *UB Estimates
NI V UK Employment Performance Employee Jobs by Sector
NI & the UK both post strong rates of employment growth in Q2 & Q3 2013
NI v UK Quarterly Employment Growth (Employee Jobs)
-1.0%
-0.5%
0.0%
0.5%
1.0%
1.5%
Q3 2007 Q3 2008 Q3 2009 Q3 2010 Q3 2011 Q3 2012 Q3 2013
Q/Q
NI UK
Source: DFP & NOMIS
NI playing catch-up with the UK employment recovery
NI & UK Annual Employment Growth
-4%
-3%
-2%
-1%
0%
1%
2%
3%
4%
5%
Q31983
Q31986
Q31989
Q31992
Q31995
Q31998
Q32001
Q32004
Q32007
Q32010
Q32013
NI UK
Source: DFP & NOMIS
NI outperformed the UK in the early 1990s but not now
NI playing catch-up with UK employment recovery
NI’s construction sector posts a quarter of growth after 7 quarters of decline
NI v UK Construction Employment Growth Q/Q (Employee Jobs)
-8%
-6%
-4%
-2%
0%
2%
4%
Q3 2007 Q3 2008 Q3 2009 Q3 2010 Q3 2011 Q3 2012 Q3 2013
Q/Q
NI UK
Source: DFP & NOMIS
UK construction industry posts modest 0.4% y/y decline in Q3 2013 while NI records a hefty 4.2% fall
Construction Annual Employment Growth Employee Jobs
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
Q31983
Q31986
Q31989
Q31992
Q31995
Q31998
Q32001
Q32004
Q32007
Q32010
Q32013
NI UK
Source: DFP & NOMIS
NI outperformed the UK in the early 1990s
but not now
Both NI & UK post strong rates of manufacturing employment growth in Q2 & Q3 2013
NI v UK Manufacturing Employment Growth Q/Q (Employee Jobs)
-6%
-5%
-4%
-3%
-2%
-1%
0%
1%
2%
3%
Q3 2007 Q3 2008 Q3 2009 Q3 2010 Q3 2011 Q3 2012 Q3 2013
Q/Q
NI UK
Source: DFP & NOMIS
NI’s employment recovery within the manufacturing sector has outperformed the UK
NI & UK Manufacturing Annual Employment Growth
-12%
-10%
-8%
-6%
-4%
-2%
0%
2%
4%
Q31983
Q31986
Q31989
Q31992
Q31995
Q31998
Q32001
Q32004
Q32007
Q32010
Q32013
Y/Y
NI UK
Source: DFP & NOMIS
NI outperformed the UK in the early 1990s
but not in 2009
NI & UK service sectors post strong rates of jobs growth in Q3 2013. The 7th successive quarter of growth for NI
NI v UK Services Quarterly Employment Growth (Employee Jobs)
-1.5%
-1.0%
-0.5%
0.0%
0.5%
1.0%
1.5%
Q3 2007 Q3 2008 Q3 2009 Q3 2010 Q3 2011 Q3 2012 Q3 2013
Q/Q
NI UK
Source: DFP & NOMIS
Until recently NI’s service sector employment recovery has lagged significantly behind that of the UK
Service Sector Annual Employment Growth
-3%
-2%
-1%
0%
1%
2%
3%
4%
5%
Q3 1983 Q3 1989 Q3 1995 Q3 2001 Q3 2007 Q3 2013
Y/Y
NI UK
Source: DFP & NOMIS
NI outperformed the UK in the early 1990s but not now
NI lagging UK employment recovery
Apart from manufacturing, NI’s job losses have been more severe than in the UK
Employee jobs relative to pre-downturn peaksas of Q3 2013
-45%-40%-35%-30%-25%-20%-15%-10%-5%0%5%
Construction Manufacturing Services Total
NI UK Source: DFP & NOMIS
NI peak Q2 2008
NI peak Q2 2007
NI peak Q4 2007
NI peak Q2 2008
NI & UK Employee Jobs, RoI Employment
Full-Time & Part-Time
Employment boom was predominantly part-time jobs while employment gloom was largely for full-timers
NI Annual Employment GrowthFull-Time & Part-Time Employee Jobs
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
Sep-93 Mar-96 Sep-98 Mar-01 Sep-03 Mar-06 Sep-08 Mar-11 Sep-13
Y/Y
Full-Time Part-Time Total
Source: DFP, Figures are not seasonally adjusted
Part-time employment growing at a much faster rate than full-time employment
Full-Time employment fell at a much faster rate than part-time
Recovery in Part-Time jobs
Surge in Full-Time employment
There are more part-time manufacturing jobs now than there were before the downturn
NI Employee jobs relative to pre-downturn peaksQ3 2013
-4.3%-1.2%
-45%
-35%
-25%
-15%
-5%
5%
15%
Manufacturing Construction Services Total*
Full-Time Part-Time
Source: DFP Unadjusted figures, * relative to September 2008
…leading to a change in NI’s employment mix
% of NI Employee Jobs Full-Time v Part-Time
25%
35%
45%
55%
65%
75%
Sep-93 Mar-96 Sep-98 Mar-01 Sep-03 Mar-06 Sep-08 Mar-11 Sep-13
Full-Time Part-Time
Full-time employment's share of total employment is falling
Part-time employment's share of total employment is rising
Source: DFP
Full-time employment's share rising again
In terms of full-time employment, NI outperformed the UK in the boom but until recently has lagged the UK recovery
NI & UK Full-Time Annual Employment Growth Employee Jobs
-6%
-4%
-2%
0%
2%
4%
6%
Sep-93 Mar-96 Sep-98 Mar-01 Sep-03 Mar-06 Sep-08 Mar-11 Sep-13
Y/Y
UK NI
Source: DFP & NOMIS
NI outperforming UK
NI’s full-time employment back to mid-2005 levels
NI Full-time & Part-time Employee Jobs Indexed Q1 1998 = 100
80
90
100
110
120
130
140
Sep-98 May-00 Jan-02 Sep-03 May-05 Jan-07 Sep-08 May-10 Jan-12 Sep-13
Index
FT PT
Source: DFP, figures are not seasonally adjusted
NI full-time employment still at mid-2005 levels
RoI is now experiencing the fastest rate of employment growth amongst full-time employees
Full-Time Annual Employment Growth Employee Jobs
2.2%
2.3%
3.8%
-15%
-10%
-5%
0%
5%
10%
Sep-93 Mar-96 Sep-98 Mar-01 Sep-03 Mar-06 Sep-08 Mar-11 Sep-13
Y/YUK NI RoI
Source: CSO, DFP & Nomis
RoI outperforming NI & UK during
Celtic Tiger boom
RoI underperforming NI & UK during Celtic Tiger bust
RoI largely outperformed the UK & NI in terms of part-time employment growth before during & after the downturn
Part-Time Annual Employment Growth Employee Jobs
2.2%
-0.6%
1.0%
-9%
-6%
-3%
0%
3%
6%
9%
12%
15%
Sep-93 Mar-96 Sep-98 Mar-01 Sep-03 Mar-06 Sep-08 Mar-11 Sep-13
Y/YUK NI RoI
Source: CSO, DFP & Nomis
RoI outperforming NI & UK during
Celtic Tiger boom
RoI still outperforming NI & UK during
Celtic Tiger bust & recovery
RoI’s rebound in Full-Time employment is due to the fact it is coming off extremely low levels
NI v UK v RoI Full-Time Employment Levels* Pre-Recession Peaks Indexed = 100
-5.5%
-2.3%
-18.5%
75
80
85
90
95
100
105
110
Peak Q2 1yr Q6 2yrs Q10 3yrs Q14 4yrs Q18 5yrs Q22 6yrsTime Since Pre-Recession Peak
Index
NI UK RoI Pre-Recession Peak
Source: ONS, CSO & DFP, *NI & UK unadjusted employee jobs
Since the downturn, part-time employment is almost 16% higher in the RoI and almost 2% higher in the UK
NI v UK v RoI Part-Time Employment Levels* Pre-Recession Peaks Indexed = 100
-2.3%
+1.6%
+15.6%
90
95
100
105
110
115
120
Peak Q2 1yr Q6 2yrs Q10 3yrs Q14 4yrs Q18 5yrs Q22 6yrsTime Since Pre-Recession Peak
Index
NI UK RoI Pre-Recession Peak
Source: ONS, CSO & DFP, *NI & UK unadjusted employee jobs
NI males and females have recouped some of the jobs lost during the downturn
NI Employee Jobs by gender & work pattern
-10%
-8%
-6%
-4%
-2%
0%
2%
4%
Full-time Part-time
All Full-time Part-time
All Full-time Part-time
All
Sep-08 to Sep-13 Trough relative to Sep-08 Recovery from trough
Source: DFP
Males Females All Employees
There are 2.9% more males in part-time employment than 5 years ago but 6% fewer full-time employees
NI Employee Jobs by gender & work pattern% Change September 2008 - September 2013
-10%
-8%
-6%
-4%
-2%
0%
2%
4%
6%
Full-time Part-time
All Full-time Part-time
All Full-time Part-time
All
Source: DFP
Males Females All Employees
In terms of part-time employment, NI outperformed the UK in the first part of the downturn but lagged in the recovery
NI & UK Part-Time Annual Employment Growth Employee Jobs
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
Sep-93 Mar-96 Sep-98 Mar-01 Sep-03 Mar-06 Sep-08 Mar-11 Sep-13
Y/Y
UK NI
Source: DFP & Nomis
Ulster Bank Northern Ireland Purchasing Managers Index (PMI)
Includes analysis of Global, Eurozone, UK, UK Regions, NI &
Republic of Ireland economic performance by sector
November 2013 Survey Update
Issued 9th
December 2013
Richard Ramsey
Chief Economist Northern Ireland
Twitter @UB_Economics
PMI SurveysPurchasing 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.
UK, RoI & NI firms all experienced jobs growth in November albeit at a weaker rate than October
Private Sector Employment LevelsMonthly
30
35
40
45
50
55
60
Nov-04 May-06 Nov-07 May-09 Nov-10 May-12 Nov-13
NI UK RoI
Source: Markit Economics & Ulster Bank NI PMI
Job Gains
Job Losses
…with all sectors also reporting job gains over the last 3 months
NI PMI - Employment Index 3 month moving average
25
30
35
40
45
50
55
60
65
Nov-04 May-06 Nov-07 May-09 Nov-10 May-12 Nov-13
Manufacturing Services Construction
Source: Markit Economics & Ulster Bank NI PMI
Job Gains
Job Losses
All the UK regions and the Republic of Ireland post employment growth in November …
Employment LevelsNovember 2013
50 = No change
54.8
51.2
55.5
46
48
50
52
54
56
58
60
Lon SW WM East SE UK NW Scot EM Wal NE NI Y&H RoI
PMI Index
IncreasingD
ecreasingSource: Markit Economics & Ulster Bank NI PMI
… and over the last 3 months to November
Employment Levels3 months to November 2013
50 = No change
54.7
51.9
55.3
44
46
48
50
52
54
56
58
Lon WM SW SE UK NW East Wal Scot NI EM Y&H NE RoI
PMI Index
IncreasingD
ecreasing
Source: Markit Economics & Ulster Bank NI PMI
NI posts a marginal decline in employment with the West Midlands & RoI the sharpest rise over the last 12 months
Employment Levels12 months to November 2013
50 = No change
52.1
53.2
49.9
46
48
50
52
54
WM SE East Lon SW UK Scot Wal NW EM Y&H NE NI RoI
PMI Index
IncreasingD
ecreasing
Source: Markit Economics & Ulster Bank NI PMI
Northern Ireland Quarterly Employment Survey (QES)
V Markit Economics / Ulster
Bank PMI
PMI signals further employment growth in Q4 2013
NI Employment: PMI v QES**
35
40
45
50
55
60
2003 Q4 2005 Q4 2007 Q4 2009 Q4 2011 Q4 2013 Q4*
PMI Index
-1.5%
-1.3%
-1.0%
-0.8%
-0.5%
-0.3%
0.0%
0.3%
0.5%
0.8%
1.0%Q/Q
PMI Employment Index No Change QES Q/Q
**QES is DFP's official Quarterly Employment Survey of the number of jobs in NI & includes public sector
Discontinuity in QES Series
Job losses
Job gains
Source: DFP, Ulster Bank & Markit Economics, PMI Index 50.0 denotes threshold between expansion / contraction, * for PMI refers to average for October & November
Services PMI more negative than QES in recent quarters. PMI signals further job gains in Q4 2013
NI Services Employment: PMI v QES*
40
45
50
55
60
65
2003 Q4 2005 Q4 2007 Q4 2009 Q4 2011 Q4 2013 Q4*
PMI Index
-1.0%
-0.5%
0.0%
0.5%
1.0%
1.5%
Q/Q
PMI Employment Index No Change QES Q/Q
Discontinuity in QES Series
Job losses
Job gains
*QES is DFP's official Quarterly Employment Survey of the number of jobs in NI and includes the public sector
Source: DFP, Ulster Bank & Markit Economics, PMI Index 50.0 denotes threshold between expansion / contraction, * for PMI refers to October & November average
Slide 69
Manufacturing PMI suggests further jobs growth in Q4
NI Manufacturing Employment: PMI v QES**
30
35
40
45
50
55
60
65
2003 Q4 2005 Q4 2007 Q4 2009 Q4 2011 Q4 2013 Q4*
PMI Index
-5%
-4%
-3%
-2%
-1%
0%
1%
2%
3%
4%
Q/Q
PMI Employment Index No Change QES Q/Q
Discontinuity in QES Series
Job losses
Job gains
**QES is DFP's official Quarterly Employment Survey of the number of jobs in NI firms
Source: DFP, Ulster Bank & Markit Economics, PMI Index 50.0 denotes threshold between expansion / contraction, * for PMI refers to average for October & November
Slide 70
The PMI & official QES numbers have pointed to job losses throughout downturn. PMI suggests more growth in Q4 2013
NI Construction Employment: PMI v QES**
20
25
30
35
40
45
50
55
60
65
2003 Q4 2005 Q4 2007 Q4 2009 Q4 2011 Q4 2013 Q4*
PMI Index
-10.0%
-7.5%
-5.0%
-2.5%
0.0%
2.5%
5.0%
Q/Q
PMI Employment Index No Change QES Q/Q
Discontinuity in QES Series
Job losses
Job gains
**QES is NI's official Quarterly Employment Survey of the no. of jobs in NI firms
Source: DFP, Ulster Bank & Markit Economics, PMI Index 50.0 denotes threshold between expansion / contraction, * for PMI refers to average for October & November
Unemployment
NI dole queue falls for the 10th month in a row
Slide 72
NI unemployment falling Claimant Count Monthly Change
-2,000
-1,000
0
1,000
2,000
3,000
4,000
5,000
May-07 Jun-08 Jul-09 Aug-10 Sep-11 Oct-12 Nov-13
M/M
Nov 2008
+3,200
Source: DFP
-4,700
…the overall dole queue set to fall back below 60,000
Slide 73
NI Unemployment Claimant Count Levels
60,200
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
Nov-86 Nov-89 Nov-92 Nov-95 Nov-98 Nov-01 Nov-04 Nov-07 Nov-10 Nov-13
Source: DFP
Jan 2013 64,900 at
mid-1997 levels
Record low Aug 0723,600
Good Friday Agreement signed
April 199857,900
It’s been a ‘Mancession’, but there now appear to be more jobs for the boys
Slide 74
NI 12 Monthly Change in Claimant Count
-5,000
0
5,000
10,000
15,000
20,000
25,000
Nov-07 Nov-08 Nov-09 Nov-10 Nov-11 Nov-12 Nov-13
Male Female
Source: DFP, ONS
Male unemployment heading down towards 40,000
Slide 75
NI Claimant Count by Gender
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
100,000
Nov-71 Nov-77 Nov-83 Nov-89 Nov-95 Nov-01 Nov-07 Nov-13
Male Female
Source: ONS, NOMIS
The number of claimants <25 years of age claiming the dole has been falling but is it due to employment of emigration?
Slide 76
Youth unemployment falls in November Claimant Count Monthly Change
-1,500
-1,000
-500
0
500
1,000
1,500
2,000
Nov-06 Nov-07 Nov-08 Nov-09 Nov-10 Nov-11 Nov-12 Nov-13
Source: DFPYouth unemployment figures are not seasonally adjusted. Therefore the spike in July
and fall in October is largely due to leaving school and starting education
No. of under 25s claiming the dole now at its lowest level since February 2009 & just 9% (1,254) above GFA levels
Slide 77
NI Youth Claimant Count Levels<25 years of age
Nov 07 low 7,050
15,399
0
5,000
10,000
15,000
20,000
25,000
Nov-97 Nov-99 Nov-01 Nov-03 Nov-05 Nov-07 Nov-09 Nov-11 Nov-13
Source: DFP
19,551 Highest level since
October 1996
GFAApril 1998
14,145
But NI-UK unemployment differential is now wider than it was when the Good Friday Agreement was signed in Apr-98
Slide 78
NI-UK unemployment rate differential widening
6.7%
3.8%
0
1
2
3
4
5
6
7
8
Feb-98 May-00 Aug-02 Nov-04 Feb-07 May-09 Aug-11 Nov-13
%
NI UK
Source: ONS / DFP Claimant Count
2.9 pp
GFA Apr 19982.8 pp
NI has the highest unemployment rate of all the UK regions using the claimant count measure
Slide 79
Claimant Count Unemployment by UK RegionNovember 2013
3.8
6.7
6.1
2
3
4
5
6
7
SE SW East Lon EM UK Scot NW Wal WM Y&H NE NI
%Source: DFP & ONS, % of Workforce
Using ILO measure, NI’s headline rate is on a par with the UK. RoI’s unemployment rate now following a downward trend
Slide 80
UK, NI & RoI (ILO) Unemployment Rates
7.4%7.5%
12.7%
0%
2%
4%
6%
8%
10%
12%
14%
16%
Oct-97 Oct-99 Oct-01 Oct-03 Oct-05 Oct-07 Oct-09 Oct-11 Oct-13
NI UK RoI
Source: ONS, Labour Force Survey & RoI Live Register
5 regions have a higher rate than NI using the ILO unemployment rate (Wales also 7.5%)
Slide 81
ILO Unemployment Rate August - October 2013
7.4% 7.5%
10.1%
0%
2%
4%
6%
8%
10%
12%
East SE SW EM Scot UK Wal NI NW Lon Y&H WM NE
Rate
Almost 1 in 4 of under 25’s in NI looking for work cannot find any
Slide 82
ILO Unemployment Rates by Age-GroupAugust - October 2013
0%
5%
10%
15%
20%
25%
18-24 25-49 50+ 16+Age Category
Source: DFP
NI has the 2nd highest youth unemployment rate in the UK
Slide 83
ILO Youth Unemployment Rate (18-24yr olds) August-October 2013
18.6%
23.8%25.2%
0%
5%
10%
15%
20%
25%
30%
SW SE East Wal NW EM Scot UK WM Y&H NE NI Lon
Rate
Source: ONS
NI’s current youth unemployment rate is > twice the rate that prevailed when the Good Friday Agreement was signed
Slide 84
Northern Ireland Youth Unemployment Rate (ILO)
Good Friday AgreementApr-98 10.6%
23.8%
0%
5%
10%
15%
20%
25%
Oct-95 Oct-98 Oct-01 Oct-04 Oct-07 Oct-10 Oct-13
Source: DFP Labour Force Survey (LFS)
NI has the lowest employment rate in the UK…
Slide 85
ILO Employment Rate (16-64yr olds) August - October 2013
67.0
72.0
60
65
70
75
80
NI NE NW WM Wal Lon Y&H UK Scot EM SW East SE
Employment Rate
…and the highest rate of economic inactivity
Slide 86
ILO Economic Inactivity Rate Rate (16-64yr olds) August - October 2013
22.1
27.4
15
20
25
30
SE East SW Scot EM UK Y&H Lon Wal WM NE NW NI
Rate %
Earnings
Median Gross Annual Earnings 2013 All Employees Full-Time
27,017
23,904
20,000
22,500
25,000
27,500
30,000
32,500
35,000
Lon SE East UK Scot SW EM WM NW Y&H Wal NE NI
£
Source: DFP & ONS ASHE
NI’s full-time employees have the lowest earnings of all the UK regions…
Median Gross Weekly Earnings 2013 All Employees Full-Time
517.5
460
400
450
500
550
600
650
700
Lon SE UK Scot East WM NW SW Y&H EM Wal NE NI
£ per wk
Source: DFP ASHE
…this is due to NI having the lowest private sector earnings for full-time employees of any UK region
Median Gross Weekly Earnings 2013 All Private Sector Employees Full-Time
490.1
402.5
250
300
350
400
450
500
550
600
650
700
Lon SE UK East Scot WM SW Y&H NW EM NE Wal NI
£ per wk
Source: DFP ASHE
Since the GFA, the gap between NI-UK median wages for full- time employees has narrowed for women but widened for men
Slide 90
NI Median Full-Time Earnings as a % of UK
86
96
89
80
85
90
95
100
1997 1999 2001 2003 2005 2007 2009 2011 2013
% Men Women All
Source: DFP Annual Survey of Household Earnings (ASHE) 2013
GFA signed April 1998
In NI, the rate of inflation has outpaced earnings growth for most individuals
% Change in N.Ireland Median Wages v UK InflationCumulative Increase 2007-2013*
0%
5%
10%
15%
20%
25%
30%
Total Public Private Total Public Private CPI RPI
All Employees Full-Time Employees Only Inflation
Source: DFP ASHE & ONS, * April each year
After inflation the median private sector wage has fallen by almost 20% in real terms (after CPI inflation)
% Change in N.Ireland Median Wages in Real Terms Cumulative Increase 2007-2013*
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
Total Public Private Total Public Private
All Employees (Full-Time & Part-Time) Full-Time Employees Only
Source: DFP ASHE & ONS, * April each year
Those aged under 30 years of age have median earnings below the NI average…
NI Annual Median Gross Pay By Age-GroupFull-Time Employees 2013
17.5
0
5
10
15
20
25
30
Age 18-21 Age 22-29 Age 30-39 Age 40-49 Age 50-59 Age 60+
£000
Source: DFP ASHE, April 2013 NI Average for all age-groups
… & those under 40 (including the household formation 25-34 yrs category) have experienced the biggest falls in real earnings
NI Gross Median Wages for Full-Time Employees Cumulative Change in Real Terms 2007-2013*
-6.3%
-25%
-20%
-15%
-10%
-5%
0%
Age 18-21 Age 22-29 Age 30-39 Age 40-49 Age 50-59 Age 60+
Source: DFP ASHE & ONS, *using CPI inflation in April each year
NI average change for employees from all age-groups
Slide 95
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is indicative,
and constitute our judgement at time of publication and are subject to change without notice.
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