Sign in My Account
Business news

Ulster Bank PMI: NI business confidence reaches highest level in over a year

Posted By:
Ulster Bank

11th Dec 2025

NI business confidence reaches highest level in over a year

  • Renewed growth of new orders and business confidence highest since October 2024 but output and employment scaled back
  • Ulster Bank Chief Economist, Sebastian Burnside, said there were “reasons for cheer” in the economy but that “firms continued to face the headwind of inflation”.
  • Ulster Bank Managing Director Corporate, Commercial and Business Banking, Mark Crimmins, said Northern Ireland businesses showed “careful optimism” and that there now needed to be a “relentless focus on growth”.

The latest Ulster Bank Regional Growth Tracker signalled a return to growth of new orders in Northern Ireland’s private sector and a strengthening of business confidence.

Less positive was a further scaling back of output and a renewed fall in employment. Meanwhile, cost pressures intensified further.

The headline Business Activity Index – a seasonally adjusted index that measures the month-on-month change in the combined output of the region’s private sector – posted 46.9 in November, down from 48.6 in October. The latest fall in activity was solid.

Respondents indicated that customer demand remained subdued, in some cases due to economic uncertainty.

Bucking the wider trend, manufacturing production increased at the fastest pace in seven months. Elsewhere, activity decreased, particularly in the construction and retail categories.

Sebastian Burnside, Chief Economist for Ulster Bank, commented:

“The November Growth Tracker data for Northern Ireland provides reasons for cheer as 2025 draws to a close, despite a further scaling back of output during the month.

“New orders increased for the first time in just over a year, led by manufacturing, and firms were increasingly confident that this will continue into 2026, with business confidence the highest since October 2024. If these positive trends continue, we will hopefully see a pick-up in business activity and resumption of employment growth that has been seen through much of the second half of this year.

“Firms continued to face the headwind of inflation, however, with input costs rising at the sharpest pace in seven months in November. This has the potential to restrict the nascent recovery in demand.”

Mark Crimmins, Ulster Bank Managing Director Corporate, Commercial and Business Banking, said:

“In spite of the challenges presented by rising costs and falling output, businesses across Northern Ireland are looking to the future with careful optimism.

“Our Ulster Bank Growth Tracker shows that business confidence is at its highest level in more than year. We need a relentless focus on growth to nurture this confidence amid a backdrop of inflationary pressures for Northern Ireland’s business community.”

The main findings of the November survey were as follows:

New business increased for the first time in just over a year in November, albeit only marginally. The increase in Northern Ireland compared favourably with a slight reduction across the UK as a whole. Anecdotal evidence suggested that improving customer demand and competitive pricing had been behind the increase in new orders. A number of companies expect new orders to continue to rise in the months ahead, supporting confidence that output will expand. In fact, firms were at their most optimistic in just over a year.

Staffing levels decreased in November, thereby ending a five-month sequence of job creation. That said, the reduction in employment was only modest. While some firms took on extra workers in order to commence planned projects in 2026, this was outweighed by those companies that were reluctant to hire and held off on replacing departing staff.

Despite the renewed increase in new business, there remained a degree of spare capacity in the Northern Ireland private sector, as evidenced by a further fall in backlogs of work. That said, the latest reduction was modest and the weakest in seven months. Suppliers’ delivery times lengthened for the fifth consecutive month, and to a marked degree. Respondents again often linked delivery delays to issues around Brexit.

Cost pressures continued to build in the Northern Ireland private sector in November. The rate of input cost inflation quickened for the second month running and was the fastest since April. The rise in input prices in Northern Ireland was the fastest of the 12 monitored UK regions and nations. Companies often reported higher wages, with increased raw material costs also mentioned. Companies responded to higher input costs by raising their own selling prices sharply again in November. The pace of inflation was little-changed from October.