Economy and labour market 

Long-standing challenges in our labour market are well understood. Chief among them are Northern Ireland’s economic inactivity rates, which have been the highest in the UK for the last 30 years. Long-term ill-health is one considerable factor, but so is the lack of affordable childcare. The latest ONS figures from February 2024 show that 25% of economically inactive women are inactive because they are looking after family/home (with 7% of men giving this as their reason too). It is not surprising that a childcare strategy has become one of the Executive’s priorities.  

Northern Ireland also consistently suffers from poor productivity. It is one of the worst-performing UK regions in this regard –around 10–20% below the UK average, and 40% lower than Ireland. Various factors impact this of course, from infrastructure to innovation to skills policy. There is, however, increasing evidence of the value of good people management too, especially across SMEs, which employ a higher than average number of people in Northern Ireland. Boosting management quality should be high on the agenda.  

Productivity is also linked to job quality more broadly and we were pleased to see the Economy Minister make good jobs one of his top priorities in his economic vision speech. Of course, this is not just about pay (although Northern Ireland does have the lowest median wage of the UK nations), but about the nature of work, its impact on employee wellbeing and the terms and conditions of employment. This is an area where Northern Ireland needs to play catch up.  

Employment law and equalities 

Recent years have seen considerable changes introduced at Westminster, with even more coming down the line, especially if there is a change of UK Government. The day-one right to request flexible working, as campaigned for by the CIPD, and the new Carer’s Leave provisions are currently set to apply across Great Britain only. Not only does this increase complexity for employers operating UK-wide, it makes recruitment and retention more challenging in Northern Ireland.   

Then there is the thorny issue of atypical workers, mostly those on so-called zero-hours contracts. It is expected that GB workers will get a new right to request predictable working later this year through the Workers (Predictable Terms and Conditions) Act 2023, something the CIPD has welcomed.  

In Northern Ireland, however, different proposals are on the table. One of the last pieces of legislation discussed before the collapse of institutions in February 2022 was the Employment (Zero Hours Workers and Banded Weekly Working Hours) Bill, on which the CIPD provided evidence. This was a more creative solution to unpredictable hours, but needs to be considered thoroughly in light of GB-wide developments if it is to be brought back.  

Then there is pay gap reporting, where Northern Ireland finds itself in a unique position too. The Employment Act (Northern Ireland) 2016 includes gender pay gap reporting provisions, largely mirroring GB-wide law. Uniquely, however, it also includes provisions for ethnicity and disability pay gap reporting, which would be more challenging to implement. More broadly, there have long been calls for harmonisation and modernisation of equalities legislation in Northern Ireland.   

Skills and training 

Skills and labour shortages continue to plague businesses across the UK and Northern Ireland is no exception. There are clear challenges with employer investment in training, but also in the mismatch between labour market demand and skills supply, as evidenced by high overqualification rates.   

Additional challenges in Northern Ireland include having the fewest people with third-level qualifications and more with no qualifications than the UK as a whole. The transition to net zero and the rapid advance of AI put skills policy in even sharper focus.  

All of the above points to a need to rethink skills development. Our recent Devolution and evolution in UK skills policy report showed the opportunities we have to learn from each other as we seek to tackle skills gaps across the economy. There are some great examples of public-private sector collaboration in Northern Ireland as well as a raft of very positive initiatives. But gaps remain, primarily around the volume of funding and SME involvement in skills.  

Our evidence suggests that there needs to be a bigger role to play for vocational/technical education and primarily apprenticeships. There are opportunities to boost the number of annual starts to meet demand, introduce hiring incentives for small businesses as well as ringfencing funding for apprenticeship levy payers. We also need to do better on upskilling and reskilling – putting the SkillUP fund on a permanent footing would be a good start.  

How you can help 

There is a real buzz of activity around public policy in Northern Ireland currently and we are keen for the CIPD to be at the heart of the discussions. The areas identified here are some initial thoughts based on our previous work and we look forward to bringing CIPD members’ expertise to the table on a whole range of issues.   

We are working on an engagement plan to gather further thoughts from our members, but in the meantime, you can take five minutes to fill in our survey or, as ever, email us with any thoughts or comments via northernireland@cipd.co.uk.