Spend Local did not stop decline of NI retail sector in final quarter of 2021
A £136.6 million cash injection from Stormont was not enough to stop the north’s retail sector declining in the final quarter of 2021, a new official report suggests.
The first ever Retail Sales Index (RSI) from the Northern Ireland Statistics and Research Agency (NISRA) showed retail output fell by 1.1 per cent between the third and fourth quarters of last year.
The Department for the Economy began issuing £100 cards under the Spend Local scheme at the start of the fourth quarter (October 4), with the spending window eventually closing on December 19.
Speaking last month, the economy minister Gordon Lyons described the scheme as “a huge success”, stating that it “achieved exactly what it set out to do”.
But the new index issued by his own department on Wednesday suggests the scheme was not enough to stem the decline in the north’s retail sector in the run up to Christmas.
The first ever RSI showed output was 2.9 per cent down on the same quarter in 2021 and remained 4.4 per cent below pre-pandemic levels from Q4 2019, while the GB index was three percent above the fourth quarter of 2019.
NISRA said that when the four most recent quarters are compared to the previous four quarters, the Northern Ireland retail sector decreased by 3.1 per cent while the GB retail sector increased by 4.7 per cent.
The new index is based on the experience of around 360 retail businesses. It includes all retailers with 100 or more staff along with smaller retailers with an annual turnover of at least £10m.
A representative sample of smaller retailers is also factored in.
In its commentary accompanying the index, NISRA made no reference to the Spend Local scheme, but said Covid-19 continued to have an impact in Q4 2021, with the Omicron variant leading to a slowdown in the easing of restrictions on businesses.
Meanwhile, new data on the north’s services and production sectors showed more signs of recovery in Q4 2021.
NISRA’s index of services reflected 1.3 per cent growth over the quarter and 9.2 per cent growth year-on-year. It left the services index at a series high, with the sector now 3.5 per cent above pre-pandemic levels.
The index showed the north’s business services sector performed particularly strongly in 2021, growing by 17 per cent year-on-year.
The production index grew 1.1 per cent between Q3 and Q4 2021, and was 2.2 per cent higher than Q4 2020.
Crucially, the index was 3.5 per cent above pre-pandemic levels. But closer analysis of the north’s manufacturing sector revealed a mixed performance.
Although manufacturing improved in Q4, it was 0.5 per cent down on the same period in 2020, largely due to a substantial 21.1 per cent decline in the chemical and pharma subsector.