Tag: business confidence

Scottish business confidence enters positive territory for first time since the pandemic began

Bank of Scotland’s Business Barometer for April 2021 shows:

  • Scottish business confidence rose 11 points to 9% in April, the first net-positive reading since February 2020
  • But firms are still expecting to reduce staffing levels over the coming months
  • Overall UK business confidence at highest level since September 2018 as lockdown restrictions lift in England and firms in Scotland and Wales begin to reopen

Business confidence in Scotland rose 11 points during April to 9%, the first positive reading since February 2020, according to the latest Business Barometer from Bank of Scotland Commercial Banking.

Companies in Scotland reported higher confidence in their own business prospects month-on-month, up 10 points at 5%.  When taken alongside their optimism in the economy, up 11 points to 13%, this gives a headline confidence reading of 9%.

The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.

When it comes to jobs, a net balance of 9% of firms expect to reduce staff levels in the next year, down from 20% last month.

Overall UK business confidence surged 14 points in April to 29%, the highest reading since September 2018. The result follows the reopening of outdoor hospitality venues and non-essential retail and personal services providers in England and comes ahead of further restrictions easing in Wales and Scotland. Firms’ confidence in their own business prospects rose by 14 points to 26% and their optimism in the economy increased by 15 points to 32%.

Most UK regions and nations reported a month-on-month increase in confidence during April, with firms in the South West (up 22 points to 30%), London (up 20 points to 32%), the East Midlands (up 20 points to 40%) and Yorkshire and the Humber (up 20 points to 32%) reporting the largest surges.

No nation or region reported a fall in confidence, and nowhere had a net-negative confidence reading for the first time since July 2019.

Fraser Sime, regional director for Scotland at Bank of Scotland Commercial Banking, said: “With hospitality and retail reopening this month, firms are feeling more optimistic as they begin to welcome people back to shop, eat and enjoy what Scotland has to offer.

“While some businesses are still planning to reduce staffing levels this year, it’s encouraging to see the number of companies planning job cuts has decreased month-on-month, a trend we hope to see continue. As lockdown restrictions ease over the coming weeks, we will continue to stand by Scottish businesses as they look to their recovery.”

Confidence increased in all sectors, with manufacturing and retail confidence levels at three-year highs. Manufacturing stood out as the most positive sector (40%), likely reflecting strong global demand and notwithstanding ongoing supply chain issues. Retail confidence jumped to 39%, while construction confidence also increased to 28%. Services confidence rose to 25%, which was also the highest it has been since 2018.

Paul Gordon, Managing Director for SME and Mid Corporates, Lloyds Bank Commercial Banking, said: “It’s very encouraging to report a continued improvement in sentiment for the UK’s regions and nations, particularly the Northern English regions that are leading the upward trend.

“In the sectors, the story is broadly positive – especially manufacturing and retail, which stood out and reported confidence levels at three-year highs. The retail sector, specifically, experienced some much-needed relief this month with the easing of lockdown restrictions.

“We hope that pent-up consumer demand will drive growth as the economy reopens further.”

Hann-Ju Ho, Senior Economist, Lloyds Bank Commercial Banking, said: “A third consecutive monthly rise in business confidence alongside the highest level of confidence for two-and-a-half years tells us a positive story about the UK’s continued economic recovery and leaves us optimistic about the road ahead.

“While uncertainties remain regarding the evolution of the pandemic, this month’s improvement in sentiment reflects a further easing of COVID-19 restrictions, while progress in vaccine deployment is raising hopes that the negative impact of the health crisis will continue to fall in the months ahead as the economy reopens.”

Confidence drops in Scotland as lockdown restrictions continue

Bank of Scotland’s Business Barometer for January 2021 shows:

  • Overall confidence of firms in Scotland fell 23 points in the past month to -32%
  • 52% of firms are confident the Covid-19 vaccination roll-out will boost trading prospects in 2021
  • Optimism falls in seven of 11 UK regions and nations as firms deal with latest lockdown restrictions

Business confidence in Scotland fell 23 points during January to -32%, according to the latest Business Barometer from Bank of Scotland Commercial Banking.

Companies in Scotland reported lower confidence in their own business prospects month-on-month, down 20 points to -27%.  When taken alongside their views of the economy, down 25 points to -37%, this gives a headline confidence reading of -32%.

The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.

The majority (65%) of firms said current Covid-19 restrictions had caused a fall in turnover but they expected the effects of the vaccine programme to boost trading prospects for 2021, with 52% saying the rollout had made them feel more confident about the year ahead. However, only 11% expect trading levels to return to pre-pandemic levels in the next twelve months.

When it comes to jobs, a net balance of 28% of businesses in Scotland expect to reduce staff levels over the next year, down five points on last month.

At UK level, overall business confidence dipped in January as the latest lockdown restrictions came into force, falling by three points to -7%. Firms’ economic optimism dropped dramatically month-on-month, decreasing by 34 points to -10%.

Almost all UK nations and regions saw a month-on-month dip in confidence during January, with the biggest falls after Scotland (-32% vs -9% in December) being reported in Wales (-20% vs -1% in December) and the South West (-8% vs 5% in December).

However, firms reported a month-on-month increase in confidence in London (up five percentage points to 3%), the South East (up seven percentage points to -4%) and North West (up eight percentage points to -5%). Yorkshire business confidence remained steady month-on-month at -4%.

Fraser Sime, regional director for Scotland at Bank of Scotland Commercial Banking, said: “This latest drop in confidence has appeared against a backdrop of tighter restrictions being reintroduced in Scotland. However, despite this dip, fewer firms report they are planning on making redundancies in the year ahead, the second consecutive month this has fallen.

“We know Scottish businesses have been resilient since the pandemic began and the vaccination roll-out is boosting firms’ optimism about the coming months. We’ll be by the side of businesses to help them navigate both the short-term challenges and long-term opportunities ahead.” 

In the industry sectors confidence remained above pre-vaccine levels (chart 4). While some sectors reported declines, manufacturing slipped by nine points to 9%, services fell by four points to -9% and retail by five points to 6%. Confidence levels in the construction sector improved for a second month, rising four points to -1%.

Paul Gordon, Managing Director for SME and Mid Corporates, Lloyds Bank Commercial Banking, said: “It has not been an easy start to 2021, but nonetheless businesses continue to persevere and remain resilient in the face of uncertainty and change – the construction sector’s confidence improving for a second month and more broadly, industry and the majority of the regional confidence sitting above pre-vaccine levels.

“While the road ahead will be challenging, we hope the news of the vaccine rollout progress will positively impact regional and sector confidence in the coming months.”

Hann-Ju Ho, Senior Economist, Lloyds Bank Commercial Banking, said: “It has been a challenging start to the New Year for UK businesses adapting to a third national lockdown alongside the new EU trade arrangement taking effect.

“Nevertheless, while confidence remains below average, it is encouraging that business sentiment is still the second highest since the low of May 2020. Overall, the vaccine rollout programme has lifted confidence and that will hopefully buoy business optimism in the coming months.”

Scottish business confidence sees sharp rise after vaccine rollout – but remains negative

Bank of Scotland’s Business Barometer for December 2020 shows:

  • Overall confidence of firms in Scotland rose 29 points in the past month to -9%
  • Companies in three of 12 UK nations and regions return to net optimistic position for the first time since March
  • Report shows biggest month-on-month improvement in UK business confidence in four years after vaccine rollout begins

Business confidence in Scotland increased to its highest point since the pandemic began in March, rising 29 points month-on-month to -9% during December, according to the latest Business Barometer from Bank of Scotland Commercial Banking.

Scottish firms’ optimism towards the economy increased by 38 points month-on-month to -12%, while confidence in their own business prospects rose 20 points to -7%.  Together, this gives a headline confidence reading of -9%.

Businesses’ hiring intentions showed that a net balance of 33% of businesses in Scotland expect to reduce staff levels over the next year, down 10 points on last month.

The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.

Across the UK, overall confidence saw its largest monthly increase for more than four years in December, following vaccine progression announcements. Confidence climbed by seventeen points to -4% in November to -4%. Economic optimism jumped 23 points to -5%, while firms’ confidence about their trading prospects increased 11 points to -3%.

All 12 UK nations and regions saw a rise in overall confidence during December. The most marked improvements were reported in Scotland (up twenty-nine points to -9%); the South West (up twenty-two points to 5%) and the West Midlands (up twenty-two points to 4%). The North East, South West and West Midlands all moved into net positive territory for the first time since March this year.

The South West recorded highest confidence at 5%, followed by the West Midlands and South West, each at 4%. The North West had the lowest confidence during December at -13%, despite confidence increasing month-on-month by 15 points.

Fraser Sime, regional director for Scotland at Bank of Scotland Commercial Banking, said: “To see an increase in the confidence of Scottish businesses is a step in the right direction as we come to the end of what has been a very difficult year.

“The roll-out of the vaccine should buoy spirits further as it helps to bring light to a Covid-19 exit strategy, but this optimism could falter in coming months with continued uncertainty over lockdown restrictions.

“Whatever the new year brings, we’ll continue to be by the side of businesses across Scotland, as we all work together to support the country’s recovery from the pandemic.”

National overview

In the industry sectors, confidence reached the highest levels seen since the start of the pandemic. Manufacturing reported a strong rebound this month despite looming uncertainty during the survey period about the UK’s new trading arrangements with the EU, surging by twenty-five points, from -25% to 0%.

This was followed by a growth in confidence for construction, which rose by eighteen points to -5%; services, which jumped by sixteen points to -5% and the retail sector which reported an eleven point lift in confidence to -1%. Nevertheless, entering the holiday trading period, confidence in retail, as in other sectors, remains below the long-term average.

Paul Gordon, Managing Director for SME and Mid Corporates, Lloyds Bank Commercial Banking, said: “It has been encouraging to see a clean sweep of regional confidence increases this month.

“Despite the regional restrictions across the UK, it is promising to see regions beginning to report above-average confidence figures. While we can primarily attribute this uptick to the news of the vaccine progress, it has also injected a boost in confidence for the sectors, with manufacturing rebounding strongly and other sectors following suit.

“We know that confidence has been volatile in 2021, it is positive to see this sharp rise in confidence and we hope this continues through to the New Year.”

Hann-Ju Ho, Senior Economist, Lloyds Bank Commercial Banking, said: “The news of the vaccine progress has bolstered this month’s confidence figures, more than offsetting uncertainties around the UK’s new trading relationship with the EU.

“While confidence remains below average and significant challenges lie ahead, it is heartening to conclude a challenging year with a notable improvement in business sentiment and with the positive momentum hopefully continuing into 2021.”

With Saturday’s latest setback, however, it’s clear that we’re far from out the woods yet. 2021 may prove to be every bit as challenging as 2020 has been for UK businesses – Ed.

Scottish business confidence remains low

Bank of Scotland’s Business Barometer for July 2020 shows:

  • Overall confidence of firms in Scotland rose four points in the past month to     -37%
  • Firms’ confidence in their own business prospects was unchanged month-on-month at -33%
  • One in ten (9%) businesses experienced an increase in demand, up four points on June

Business confidence in Scotland rose four points during July to -37%, according to the latest Business Barometer from Bank of Scotland Commercial Banking.

Companies in Scotland reported the same level in confidence in their business prospects month-on-month at -33%.  When taken alongside their views of the economy overall, this gives a headline confidence reading of -37%.

The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.

The majority of firms continued to see demand negatively affected by coronavirus during July. Almost two thirds (64%) experienced a fall in demand for their products and services, up six points on the month before. However, 9% experienced an increase in demand, up four points on June.

With the Job Retention Scheme beginning to wind down from August, two fifths (41%) of Scottish firms surveyed said they didn’t currently have any furloughed workers.

Of the 55% of businesses reporting disruption to their supply chain during July, 18% expected the situation to improve within three months, while only 2% expected it would take more than 12 months to return to normal levels.

Fraser Sime, regional director for Scotland at Bank of Scotland Commercial Banking, said: “While marginal, the slight increase in confidence we’ve seen this month is a step in the right direction.

“There’s still a long way to go for confidence to fully recover, but the current transition to Phase 3 of lockdown should hopefully continue to boost many firms’ trading prospects.

“Pessimism is waning in many English regions as the hospitality and leisure sectors open their doors once again. With many firms beginning to restart operations here in Scotland this month, August will be telling as to whether the same confidence-inducing effect will take hold here too.”

National overview

At UK level, confidence increased eight points to -22% during July. The North East was the most confident region at -3% followed by the West Midlands (-7%) and the North West          (-15%). Wales and Scotland were the least confident with -31% and -37% respectively.

In July, the retail sector increased 11 points to -12%, manufacturing increased 14 points to -21% and services rose 10 points to -26%. However, construction fell eight points to -22% after last month’s strong increase of 30 percentage points.

Paul Gordon, Managing Director for SME and Mid Corporates, Lloyds Bank Commercial Banking, said: “With only one region reporting a fall in sentiment, we are starting to see sentiment lift for the vast majority of regions across the UK. 

“The easing of lockdown restrictions, including the reopening of the economy and the relaxation of social distancing rules, has resulted in most businesses reporting improvements in demand, from a record-low base. This is key for the summer season, which will allow businesses to continue to open their doors and trade in the weeks and months ahead.”

Hann-Ju Ho, Senior Economist, Lloyds Bank Commercial Banking, said: “While the results suggest the economy is starting to see some improvement, economic confidence still remains in deep negative territory.

“The Government announcement of the slight easing of social distancing measures has now enabled over half of businesses to reach their capacity and resume their usual activities. However, how businesses will continue to respond to the Job Retention Scheme will be key in the coming months.”

March sees sharp fall in Scottish business confidence

Bank of Scotland’s Business Barometer for March 2020 shows:

  • Overall confidence for firms in Scotland fell 22 points in the past month to -7%
  • Firms’ confidence in their own business prospects was -4%, compared with 14% in February
  • Research undertaken between 2nd and 16th March shows a sharper fall in confidence nationally during second week of the survey at -3%, among the lowest figures seen since the financial crisis

Business confidence in Scotland fell 22 points during March to -7%, according to the latest Business Barometer from Bank of Scotland Commercial Banking.

The research, taken between the 2nd and 16th March, showed that companies in the region had lower confidence in their business prospects at -4%. When taken alongside their views of the economy overall, this gives an overall confidence of -7%.

Across the UK, overall business confidence fell by 17 percentage points to 6% in March, the lowest level since October 2019.

However, the report showed that nationally, for the second week of the survey, a much sharper fall in overall confidence was recorded at -3%. It matches the lowest dip seen by the barometer since December 2011 and is otherwise the lowest dip since March 2009 during the global financial crisis.

Responding specifically to the impact of the Coronavirus, 66% of Scotland businesses stated that they had already been affected or expected to be impacted, ahead of Boris Johnson’s initial call for the public to stay at home on March 16th. The data illustrates the impact that the outbreak was having on business confidence before many initiatives launched by the Government to help combat the virus were announced.

The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.

Fraser Sime, regional director for Scotland at Bank of Scotland, said: “It’s impossible to accurately predict how COVID-19 will impact the Scottish economy, so it’s not surprising to see the confidence of Scottish businesses taking a dip as the pandemic evolves.

“The First Minister has called for a partnership to get through this period where the public sector, trade unions, businesses and third sector organisations work together to support Scotland’s workforce. We’re also working by the side of businesses and the government to help firms adapt and adjust as we navigate through this unprecedented period.

“At Bank of Scotland, we’ve committed to lend up to £18bn to businesses this year and have set aside £2bn of arrangement fee free finance to help those directly impacted by COVID-19. From tourism and hospitality to manufacturing, this support is available now. And we will continue to guide and help businesses across all sectors through any interruptions they may face.”

Businesses in the North East had the highest confidence at 23%, ahead of the South West at 16%, and London at 12%.

Those in the South East were the least confident, with an overall confidence of -10%, 16 points below the national average.

Sector overview

In March, overall business confidence fell across all four sectors surveyed. Confidence in the retail sector saw the sharpest decline, falling 21 percentage points to 9%. The manufacturing sector also saw a big decline from 31% to 11%, services was down 18 points to 1%, while the construction sector fell by 15 points to 14%.

Paul Gordon, Managing Director for SME and Mid Corporates, Lloyds Bank Commercial Banking, said: “There is now little doubt that businesses across the board are feeling the impact of COVID-19. 

“Many businesses have already had to pause their work and others are trying to adapt to new ways of working.

While all sectors have displayed a real dip in confidence, it is important that businesses take the support that is available to them to help them through this unprecedented and uncertain time. We remain committed to supporting our customers in the weeks and months ahead in any way we can.”

Hann-Ju Ho, Senior Economist, Lloyds Bank Commercial Banking, said: “The results in March demonstrate the impact of the shutdown of large swathes of the economy to combat the pandemic even in advance of the Government’s stringent measures announced in recent days.

“Sentiment has returned to historic low levels after improving in recent months. We will continue to monitor what businesses are telling us, and hope that they can take steps to minimise the impact of current economic downturn.”

Scottish business confidence fell in May

Bank of Scotland’s Business Barometer for May 2018 shows: 

  • Scottish firms’ confidence in their own business prospects sits at 26 per cent
  • Economic optimism stood at three per cent, 15 points below last month 

Overall businesses confidence in Scotland fell during May, according to the latest Business Barometer from Bank of Scotland Commercial Banking. Continue reading Scottish business confidence fell in May

Uncertainty weighs on Scottish business confidence, according to regional Business Barometer report

The Bank of Scotland’s Business Barometer for March 2018 shows:

  • Overall confidence for firms in Scotland fell 23 points last month to 12 per cent
  • Firms’ confidence in their own business prospects was 18 per cent
  • Economic optimism remains positive but now stands at just five per cent
  • A net balance of 10 per cent of Scottish firms now expect to hire more staff this year

Business confidence in Scotland fell 23 points to 12 per cent in March, according to the latest Business Barometer from the Bank of Scotland. Continue reading Uncertainty weighs on Scottish business confidence, according to regional Business Barometer report

Scottish business confidence steady … but among lowest in UK 

 

  • Business confidence in Scotland drops slightly from July but remains among lowest in UK
  • Investment intentions remain level for second year running
  • More businesses expect to cut jobs during the next six months than expect to create them
  • Economic uncertainty remains greatest risk to firms

Scottish businesses have reported the second lowest confidence rates in the country amid market uncertainty and concern over weak domestic demand, according to the latest Business in Britain report from Bank of Scotland. Continue reading Scottish business confidence steady … but among lowest in UK