Business

North’s economy grew by 0.4% in second quarter of 2024, driven by construction and services sectors

Construction output reached 15-year high in the second quarter of 2024, according to Nisra

A woman analyzing financial stock market with reflection on eyeglasses
Northern Ireland's business and financial services sector has been a significant driver of economic growth in the past year. (Westend61/Getty Images/Westend61)
By Ryan McAleer

The north’s economy grew by 0.4% in the second quarter of 2024, with output now 2.3% higher over the year, official figures show.

Growth was stronger in the private sector, according to the Northern Ireland Composite Economic Index (NICEI), with output increasing by 0.5% over the April to June period, leaving it 3% up over the year.

However, it marked a slowdown on the 1.4% growth recorded in the first three months of 2024.

Private sector growth was primarily driven by the construction and services sectors.

That growth was offset by a 0.2% contraction in the public sector output during the second quarter, leaving it 0.1% down on the same period last year.

Table charting the last eight quarters of the Northern Ireland Composite Economic Index (NICEI),
Table charting the last eight quarters of the Northern Ireland Composite Economic Index (NICEI), (Nisra)

The latest economic index, compiled by the Northern Ireland Statistics and Research Agency (Nisra) is the closest thing Stormont has to measuring gross domestic product (GDP).

Although not produced on a fully equivalent basis, Nisra said UK GDP grew by 0.6% in the second quarter, but concluded that the north enjoyed stronger growth over the year (+2.3 v +0.9%).

Economic output in Northern Ireland is now 8.1% above pre-pandemic levels.

The report covers a period where unemployment reached a record low in the north.

The official rate dropped to 1.9% in the April to June quarter, the first time on record that unemployment dropped below 2% in Northern Ireland.

Data published by Nisra earlier this month suggest the services sector grew by 3.8% in the second quarter.

The growth in the sector, which accounts for around 55% of all Northern Ireland businesses, was helped by an ongoing boom in business and financial services.

The financial sub-sector grew by 8.9% in the 12 months to the end of June 2024.

Meanwhile, Nisra said construction output reached a 15-year high in the second quarter of 2024.

The statistic body’s quarterly construction bulletin estimate output in the sector increased by 3.4% in the second quarter of this year, leaving output up 10.5% over the year.

Chart displaying Seasonably adjusted output in the north's construction sector.
Seasonably adjusted output in the north's construction sector. (Nisra)

The growth in the second quarter was driven by ‘repair and maintenance’ (+7.2%), ‘other work’ (+13.6%), housing (+2%) and ‘new work’ (+2.6%).

The same report suggests the infrastructure sub-sector contracted by 2.2% over the quarter.

The official data comes just one day after EY upgraded its forecast for the Northern Ireland economy this year.

The professional services group said it believes GDP in the north will increase by 1.1% in 2024, up from its previous forecast of 0.7%.

Other recent forecasts over the summer from PwC and Ulster University’s EPC ranged from 1.2% to 1.4% for 2024.

EY is forecasting economic growth in the north will accelerate to 1.8% next year.

But Republic is expected to again outperform Northern Ireland by growing 2.3% this year and 4.3% in 2025.