New report highlights a cooling in confidenceby Liz Hughes, Head of ACCA IrelandThe last twelve months have provided sustained momentum within the Northern Ireland economy for the first time since 2008.  Economic growth by the end of 2014 is expected to rise by 2.4%. There has been resurgence in the growth of professional services such as accountancy, IT and recruitment, household spending is up and house prices are also starting to rise – a more positive economic picture, reflective of many other global countries.However, the ‘Global Economic Conditions Q2’ (GECS) report conducted by ACCA (the Association of Chartered Certified Accountants) and IMA (the Institute of Management Accountants) which surveys the business outlook of finance professionals, has stated that threats to long term economic stability remain extremely challenging as countries recover from the global crisis.The report highlights that the financial crisis and global recession have now fragmented into multiple unresolved issues - damaged bank and government balance sheets, unconventional economic policies, political polarisation and geopolitical tensions. These are still present five years on, despite a growing ‘recovery consensus.’According to the ACCA and IMA report many businesses in Northern Ireland and throughout the island of Ireland are among those that continue to struggle. While the second quarter of 2014 saw a marginal upturn in business opportunities, demand weakened and access to growth capital tightened.Although the change in business confidence between Q1 and Q2 2014 is considered negligible, the perceived stability is the result of dwindling business opportunities and an improving investment environment cancelling each other out, according to the report’s findings.More than two years of improvement in expectations regarding public spending also came to an end with financial professionals believing that there is a greater risk of government under spending in the medium term. This perception is borne out by the political challenges within the Northern Ireland Executive to agree on a budget.While different economic surveys indicate the economy is expanding the GCES report states that the global economic recovery has started to run out of momentum. Within a micro economy such as Northern Ireland’s, which is so dependent on external factors, maintaining momentum is key.  Those with influence must work to alleviate stagnation and build upon the work that has been done to secure inward investment and ensure the economy can capitalise on the opportunities that arise by developing a more skilled workforce.The consistent message coming back from business leaders is that there is a distinct lack of skilled employees suitable to enter the working environment, meaning that our economy is not in a position to fully capitalise on its opportunities. Recent research from the Prince’s Trust indicates 89% of businesses in Northern Ireland fear a skills shortage could impact their business in the next few years. The biggest fall out of a skills crisis is that business growth will be stunted and will impact companies who are ready to expand and break into new markets. This in turn will hinder future employment and have a regressive impact upon economic growth.Whilst there is fear of cuts and job losses in the public sector the good news is that permanent jobs are currently on the rise according to a report by Hays Recruitment; and there is a major focus on encouraging young people to stay in Northern Ireland amongst business and political circles.  Hays report states that one in every four employees, particularly within the accountancy and finance sectors are being offered new jobs with added benefits to entice them to work here.  What is clear from ACCA's and the IMA's report is that this is going to be a difficult road to full recovery with fluctuations in business confidence.  There will be areas that cannot be influenced, particularly within such a small economy as Northern Ireland’s but what we must do is maximise the opportunities that do arise and ensure we have the workforce to deliver them.