4th Report – Economic growth in Northern Ireland: new and emerging sectors

Key findings

• Northern Ireland's economy grew 12% above pre-pandemic levels (vs. 5.2% UK-wide), but multiple competing economic strategies from the UK Government and NI Executive create confusion for businesses and lack clear coordination.
• 89% of NI firms are micro-businesses with limited capacity for innovation and growth; fragmented support from over 100 programmes across multiple bodies overwhelms SMEs seeking R&D funding and trade advice.
• Dual market access through the Windsor Framework offers strategic advantage but remains under-realised; 64% of NI businesses lack understanding of its benefits, and East-West trade has declined due to regulatory complexity.
• Structural weaknesses—poor infrastructure, inadequate skills, slow planning, and higher energy costs than GB—disproportionately affect growth outside Belfast, creating regional imbalance; 35% of vacancies are skills-shortage related.
• UK Shared Prosperity Fund revenue funding for training and employability ends March 2026; its Local Growth Fund replacement cuts revenue funding by 64%, threatening vulnerable employment support programmes and further undermining skills development.

Recommendations

• The NIO should publish a comprehensive 'economic vision' within six months detailing UK Government plans for Northern Ireland growth with SMART objectives (specific, measurable, achievable, relevant, time-bound) including expected economic growth, employment, and productivity gains.
• Appoint a Northern Ireland representative to the Industrial Strategy Advisory Council to ensure devolved economic concerns feed into policy development and the Strategy supports NI growth appropriately.
• Establish a completely overarching one-stop shop for NI SMEs covering innovation funding, East-West trade, North-South trade, EU access, and broader business support; clarify opening date within the next financial year.
• Appoint a Great Britain representative to Intertrade UK's Board to ensure GB-based trading challenges with Northern Ireland are heard and addressed by Government.
• Reverse revenue funding cuts in the Local Growth Fund or establish alternative funding sources to prevent closure of employment support and community voluntary programmes vital to skills development.
• Expand City and Growth Deals to fund core infrastructure investment and skills programmes alongside existing capital projects; extend devolved economic development powers to local authorities where demonstrated through these deals.

Key actors

Tonia Antoniazzi, Hilary Benn, Matthew Patrick, David Quinn, Baroness Foster of Aghadrumsee, Alison McCullagh, Colin McCabrey, Secretary of State for Northern Ireland