In my New Year message at the start of this month, I set out why addressing issues including skills challenges, educational reform, low productivity levels and investment in infrastructure will be critical for businesses in 2022. The delivery of these priorities hinges, to a significant extent, on political stability at Stormont.
An election in May will see a new Executive formed. It is crucially important that the Assembly is not dismantled any earlier than planned, as to do so would seriously damage local and international business confidence.
Business plays a fundamental role in delivering for people and communities, so whatever the make-up of the next Executive, it is vitally important for everyone that the next set of Ministers keeps the economy front and centre.
Over the course of the coming months and throughout the next Assembly mandate, businesses, their employees and everyone in society deserves strong representation in a stable devolved government. After the seismic challenges of the past two years, businesses in particular need certainty for all aspects of trade, support for continued recovery and the right conditions for sustainable growth. This can only be delivered by a sitting, functioning Northern Ireland Assembly.
Encouragingly, NI Chamber’s most recent Quarterly Economic Survey report provided cause for cautious optimism. The results from Q4 2021 indicate that confidence is keeping up in spite of challenges, particularly around pressure to raise prices. All key economic indicators were positive in Q4 21, a signal of improving trading conditions. However, many firms are still dealing with the compound impact of new trading arrangements, uncertainty around the Protocol, Covid-19 restrictions, supply-chain difficulties, increased costs and labour shortages. Businesses have proved themselves to be resilient but in this context, the support of policy makers is incredibly important.
For example, Northern Ireland has had a skills shortage for decades, which has been exacerbated since the onset of the pandemic. Whilst the proportion of people in employment has risen consistently for six years, high levels of long-term economic inactivity remain. We need to invest in languages and digital skills, increase apprenticeship numbers, deliver wrap-around support for people with no or low qualifications and develop a flexible and cost effective immigration system that ensures fast access to skills when they can’t be recruited locally.
The problem is, the required level of finance is not in place to deliver solutions to the skills problems we have. NI Chamber welcomed the Skills Strategy and supports the establishment of the Skills Council. But until appropriate funding is in place, change on the scale that we need simply won’t be achieved.
Addressing Northern Ireland’s low levels of productivity is going to be crucial, both regionally, relative to the rest of the UK and in those parts of Northern Ireland where performance is particularly poor. ‘Levelling up’ means maximizing external and internal connectivity with high-quality physical and digital infrastructure. It also means supporting infrastructure investment connected to Northern Ireland’s key strategic priorities, including the Energy Strategy, Green Growth Strategy and 10x Economy Vision.
Whilst all these recent strategies are welcome, progress has been slower than expected, especially as we emerge from Covid-19. It is important that this year, there is a renewed focus on implementation, with key decisions being made before the forthcoming election purdah kicks in.
We are challenging the NI Executive to create the right conditions for business growth and want to work with them in the process. But they are by no means the only elected representatives who need to keep Northern Ireland businesses front of mind. As the UK and EU negotiators continue their discussions around the Protocol, we urge them to come to a timely and clear agreement, with transition periods built in to give businesses the clarity and certainty they need, whilst avoiding any further cliff edge deadlines.