Northern Ireland’s economy demonstrated robust growth in the first quarter of 2026, with output increasing across services, retail and production sectors, according to official statistics published today by the Northern Ireland Statistics & Research Agency (NISRA). The figures reveal that the local economy continues to outpace the UK average in key industrial sectors while maintaining recovery momentum above pre-pandemic levels.
Data covering January to March 2026 reveal particularly strong performance in the production sector, which outpaced UK trends, while services and retail also posted healthy quarterly gains. However, the statistics carry a significant time lag, capturing economic conditions from earlier in the year prior to more recent global developments.
Services Sector Shows Mixed Growth Patterns
The NI Index of Services increased by 0.9% over the first quarter of 2026 and by 2.3% over the year. This compares favourably to the UK Index of Services, which rose by 0.8% over the quarter and 1.4% over the year, remaining at a UK series high.
NI services output now stands 11.3% above the pre-pandemic level seen in Quarter 4 2019, while UK services output is 8.4% above that benchmark. The sector is also 42.6% higher than its series low point in Quarter 2 2020.
Quarterly growth was driven by strong performances in:
- Business services and finance: up 4.1%
- Transport, storage, information and communications: up 3.0%
- Other services: up 2.6%
This was partially offset by a 0.3% decrease in the wholesale and retail trade; repair of motor vehicles and motorcycles; accommodation and food service sector. Over the year, this latter sector declined by 0.2%, contrasting sharply with the 8.4% annual growth seen in business services and finance.
Retail Sales Outperform Great Britain
The NI Retail Sales Index (RSI) rose by 2.1% in Quarter 1 2026 and by 1.8% over the year. This outpaced Great Britain, where the RSI output increased by 1.4% in the quarter and 2.6% over the year.
NI retail output is now 3.9% above the pre-pandemic level seen in Quarter 4 2019, while GB RSI output remains 0.7% below its Quarter 4 2019 level. When comparing the most recent four quarters to the previous four quarters, the NI retail sector increased by 4.4% while the GB retail sector increased by 1.8%.
NISRA notes that the RSI has been released as an “official statistic in development,” meaning it remains in a testing and development phase with potential future methodological changes.
Production Sector Surges Ahead of UK
The NI Index of Production (IOP) increased by 2.1% over the quarter and by 7.6% over the year—substantially outpacing the UK IOP, which rose by just 0.2% over the quarter and 0.1% over the year. When comparing the most recent four quarters to the previous four quarters, the NI production sector increased by 4.3% while the UK production sector decreased by 0.3%.
NI production output is now 10.3% above the pre-pandemic level seen in Quarter 4 2019, while the UK IOP remains 7.0% below its Quarter 4 2019 level.
Quarterly growth was driven by increases in three of the four main sectors:
- Manufacturing: up 1.6%
- Electricity, gas, steam and air conditioning supply: up 6.1%
- Mining and quarrying: up 10.4%
This was partially offset by a 1.5% fall in water supply, sewerage and waste management (including recycling). Over the year, manufacturing grew by 9.1% and electricity/gas supply by 7.4%, while water and waste management fell by 6.0%.
Data Limitations and Context
While the headline figures suggest economic strength, the release leaves several analytical gaps. The data covers January to March 2026, creating a significant lag before publication in mid-June. Notably absent from this bulletin is the construction sector, due for publication on 25 June 2026 alongside the NI Composite Economic Index.
The retail statistics remain experimental, and the release provides no regional breakdown within Northern Ireland, potentially masking disparities between urban and rural economic performance. Additionally, the bulletin does not address how inflation may be affecting these volume measures or whether the strong production growth reflects sustainable expansion or temporary factors.
Key questions arising from the data include:
- What explains the divergence between robust business services growth (+8.4% yearly) and the stagnant wholesale, retail and hospitality sector (-0.2%)? Does this signal a two-speed services economy?
- Can Northern Ireland maintain its production sector advantage over the UK (7.6% versus 0.1% yearly growth) amid global supply chain pressures and energy cost volatility?
- Why does Northern Ireland’s retail sector remain resilient above pre-pandemic levels while Great Britain’s continues to lag? Will this gap narrow or widen as cost-of-living pressures evolve?
- How will the exclusion of construction data from this release affect policy decisions until the full economic picture emerges on 25 June?
The statistics indicate that Northern Ireland’s economy entered the second quarter of 2026 on relatively solid footing, with all measured sectors above pre-pandemic benchmarks. However, the true test of sustainability will come with the next data release on 25 June, which includes construction and the Composite Economic Index, providing a complete picture of economic health.
The Index of Production and Index of Services reports for Quarter 2 2026 are scheduled for publication on 17 September 2026, providing crucial insight into whether the strong start to the year has maintained momentum through the spring and early summer.