‘Torrid’ time for large business chains in past year contributes to 30% rise in NI redundancies
THE number of redundancies confirmed by firms across Northern Ireland grew by almost onethird in the past year, according to official figures.
The latest labour market statistics, published by the Northern Ireland Statistics and Research Agency (NISRA), revealed that there were 2,907 confirmed redundancies between August 1, 2017 and the end of July this year, up from 2,240 on the previous year.
The report has also revealed there were 133 confirmed redundancies last month, down from the record 792 job cuts confirmed in June.
Manufacturing was particularly badly affected, with 40% of all confirmed job losses in the sector, while a further 24% of confirmed redundancies happened in the wholesale and retail trade.
There are currently another 1,521 posts under threat.
David Armstrong from PwC in Northern Ireland warned that more significant redundancies could be on the horizon as companies such as Homebase, House of Fraser and Carpetright implement major restructuring plans.
“High streets across the UK have had a torrid year and Northern Ireland has felt its share of the pain with job losses as Poundworld, Maplin and Toys R Us shut up shop,” he said.
There may be more to come as the future of Homebase outlets are unclear, as are the implica- tions of the proposed merger of Sainsbury’s and Asda.
“But other sectors have suffered too. Kilroot Power Station, Wrightbus, Bombardier and Senasta Technologies all cut workforce numbers, leading to a sixyear high in June, when total of 790 local redundancies were announced,” Mr Armstrong said.
“Global uncertainty, dwindling consumer expenditure, international competition and — inevitably — Brexit uncertainty are all contributing to the total. And, with the prospect of interest rates rising, we could see a number of so-called ‘zombie companies’ pushed to the brink as they struggle to service debt in this competitive environment.”
The NISRA report also revealed that Northern Ireland’s unemployment rate has risen from its record low although it is still lower than the UK average.
It found that the unemployment rate here has been under 4% for the last nine months, standing at 3.8% in second quarter of the year.
While this is up from 3.1% — the lowest unemployment level here in a decade — it is down from the 5.3% rate just one year ago.
The figures also show that between April and June of this year, more than 63% of those unemployed in Northern Ireland were long- term unemployed, compared to 26% in the UK.
Roger Pollen from the Federation of Small Businesses (FSB) said he was concerned that unemployment has increased by 0.6% over the most recent quarter, while the employment rate has dropped by 0.4%.
“While our rate of unemployment is historically low and below the UK average, the level of people in work lies considerably below the overall UK rate,” he said.
“Indeed, when compared over the year, we can see that the actual level of employment has barely increased in 12 months.
“If the challenge of economic inactivity is not addressed, businesses will struggle to find staff to fill the jobs of the future — a situation that may well be exacerbated by Brexit.
“Government should be seeking to incentivise firms to take on people who are long-term unemployed by providing a oneyear National Insurance holiday for firms that hire those furthest from the labour market.”
Mr Pollen added that, as it employs so many people, the Small to Medium Enterprise sector could play a crucial role in reducing economic inactivity and boosting the local economy.