Purchasing Managers' Index (PMI) surveys track private sector economic indicators like output, orders, employment and prices. The surveys produce index numbers from 0-100, with readings above 50 indicating expansion and below 50 indicating contraction. The October 2015 PMI survey update found that global manufacturing rebounded but services growth was mixed across regions. Eurozone growth rates increased but construction remained contracted. UK and Ireland posted some of the fastest manufacturing and services growth, while inflation remained subdued.

1. Ulster Bank Northern Ireland
Purchasing Managers Index (PMI)
Includes analysis of Global, Eurozone, UK, UK Regions, NI &
Republic of Ireland economic performance by sector
October 2015 Survey Update
Issued 9th November 2015
Richard Ramsey
Chief Economist Northern Ireland
www.ulstereconomix.com
richard.ramsey@ulsterbankcm.com
Twitter @UB_Economics

2. PMI Surveys
Purchasing Managers’ Indexes (PMIs) are monthly surveys of private sector companies
which provide an advance indication of what is happening in the private sector economy
by tracking variables such as output, new orders, employment and prices across different
sectors.
Index numbers are calculated from the percentages of respondents reporting an
improvement, no change or decline on the previous month. These indices vary from 0 to
100 with readings of 50.0 signalling no change on the previous month. Readings above
50.0 signal an increase or improvement; readings below 50.0 signal a decline or
deterioration. The greater the divergence from 50.0 the greater the rate of change
(expansion or contraction). The indices are seasonally adjusted to take into consideration
expected variations for the time of year, such as summer shutdowns or holidays.
< 50.0 = Contraction 50.0 = No Change > 50.0 = Expansion
Data at a sector level are more volatile and 3-month moving averages have been used to
more accurately identify the broad trends.

3. Global manufacturing output rebounds from 29-
month low with service sector activity picking up too

4. EZ manufacturing & services sector growth rates increase
but retail sales slow & construction still contracting

5. The Eurozone’s composite PMI signals some loss of
economic momentum in Q3 2015 but steady in Q4*

6. UK tops the manufacturing output growth table with
Ireland mid-table

7. The Republic of Ireland, Spain & the UK posted the
fastest rates of service sector output growth in October

8. All economies bar the Republic of Ireland post better
composite PMIs in October relative to September

9. Composite PMIs for China, Japan, the Eurozone and the
UK all improved in October with the US unchanged

10. Manufacturing activity picked-up in Japan & the EZ, was
flat in the US and still contracting in China

11. Chinese Composite PMI rebounds from September’s low

12. Emerging Markets PMI remains in contraction territory

13. Australia’s services & manufacturing sectors signal a
marked downturn in October

14. NI posts its 6th consecutive month of private sector growth
but pace of growth still lags behind the UK & RoI

15. PMI signalled a slowdown in the pace of jobs growth in
H2-14 but rebounds in H1-15 & accelerates in Q4*

16. PMI suggests growth in DFP’s private sector composite index during
2014 but recovery stalls in Q1-15 with a modest rebound in Q2 & Q3-15

17. 2014 was the first year in 7 years that business activity,
new orders, employment & export orders all expanded

18. Output & new orders growth slow in Q4* relative to
Q3 but export & employment growth accelerates

19. NI firms post a pick-up in the pace of job creation but
the growth rates for new orders & business activity slow

20. UK & NI firms report a slowdown in new orders growth
with RoI’s order books still expanding at a rapid rate

21. Backlogs of work continue to grow amongst RoI firms with
levels of outstanding work for NI & UK firms falling / flat

22. Export orders rise for the 4th time in 5-months

23. RoI, UK & NI firms all report a pick-up in the rates of
employment growth in October

24. Inflationary pressures remain relatively subdued and
output prices are falling again

25. Regional
Comparisons

26. All UK regions bar North East of England post output
growth in October

27. All UK regions posted growth but growth in NI, NW,
NE & Scotland remains well below UK average

28. The RoI reported the fastest rate of growth in business
activity over the last 12 months & Scotland & NI the slowest

29. Scotland, NE and the South West post the weakest
rates of job creation within the UK in October

30. Scotland, NI and the South West post the weakest rates
of job creation within the UK over the last 3 months

31. Scotland, the North East & NI posted the weakest rates of
jobs growth over the last year with the RoI the strongest

32. Sectoral
Comparisons

33. UK services & manufacturing PMIs surprised to the
upside in October

34. The UK posts strong rates of growth throughout 2014 &
more recently in Q2-15. Loss of momentum in Q3

35. RoI output growth within manufacturing & services
sectors eases in October

36. Retail & construction posted stronger rates of growth in
H2* than H1 while services & manufacturing held steady

37. NI manufacturing & services firms report an easing in
output growth while construction back in expansion mode

38. Services firms are still in hiring mode, construction
employment flat while manufacturing is losing jobs

39. NI’s manufacturing firms appear to be experiencing a
marked slowdown since mid-2015

40. RoI firms post a sharp slowdown in output growth with NI
firms reporting a slowdown too. UK firms bucking the trend

41. NI firms report a more marked slowdown in manufacturing
orders growth than their equivalents in the UK & RoI

42. All economies bar Italy saw output growth slow or
contract (Greece) in October

43. Input cost inflation for manufacturers remains
subdued with output price deflation accelerating

44. PMI signals moderation in jobs growth in H2-14 & Q1-15
following record high in Q2-14 and contraction from Q3-15

45. Service sector experiences a pick-up in employment
growth but business activity & new orders growth slows

46. NI firms fail to match the robust rates of growth in the UK &
RoI service sectors but UK output growth is slowing fast

47. RoI firms continue to report very strong rates of growth in
new orders whilst growth amongst NI & UK firms slows

48. Profit squeeze intensifies for NI’s services firms as input
cost inflation accelerates & pricing power remains weak

49. NI services firms increased their staffing levels over the
last 3 months but below the rates of growth in the UK & RoI

50. Pace of job creation within the services sector eased in
H2-14 but has picked up in H1-15 & accelerated in Q3/Q4*

51. NI retailers report a significant increase in sales and new
orders in recent months but rate of growth is moderating

52. NI retailers report a marked decline in pricing power with
output prices falling at their fastest rate since June 2009

53. NI’s construction firms reporting rising rates of output &
new orders growth

54. Input cost inflation remains subdued as local firms
continue to enjoy pricing power

55. NI’s construction PMI posts jobs growth Q3-13 to Q2-15
with a dip in Q3 but a return to job growth in Q4*

56. UK & RoI firms reporting strong rates of output
growth with NI firms lagging someway behind

57. New orders growth remains steady in the UK & RoI with NI
firms reporting a rise after a period of decline

58. UK construction firms post a pick-up in commercial activity
with growth rates for housing & civil engineering moderating

59. UK sub-contractors remain in short-supply with rates
charged still rising

60. Optimism amongst UK construction firms remains high

61. RoI construction activity linked to civil engineering &
housing experiences an improvement in October

62. RoI’s construction industry still reporting a decrease in
the availability of sub-contractors & rising rates of pay

63. RoI construction firms still remain very optimistic
about the year ahead

64. Slide 64
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