Tag: economic trends

Scottish business confidence falls in September

  • Business confidence in Scotland fell 20 points to 39% in September 
  • Firms’ optimism in their own trading prospects fell 20 points to 45%, while optimism in the economy dipped 18 points to 34% 
  • Overall UK business confidence dipped 12 points in September to 42%. 

Business confidence in Scotland fell 20 points during September to 39%, according to the latest Business Barometer from Bank of Scotland. 

Companies in Scotland reported lower confidence in their own business prospects month-on-month, down 20 points at 45%. When taken alongside their optimism in the economy, down 18 points to 34%, this gives a headline confidence reading of 39% (vs. 59% in August). 

Looking ahead to the next six months, Scottish businesses identified their top target areas for growth as investing in their team, for example through training (44%), evolving their offering, for example by launching new products or services (39%) and introducing new technology (30%).  

The Business Barometer, which surveys 1,200 businesses monthly and which has been running since 2002, provides early signals about UK economic trends both regionally and nationwide.  

National picture 

Overall, UK business confidence fell 12 points in September to 42%.  

Firms’ confidence in their own trading prospects fell 12 points to 51%, and their optimism in the wider economy fell 11 points to 33%.  

The North East of England was the most confident UK nation or region in September, climbing 13 points to 68%, followed by London (57%).  

Sector insights 

Firms across manufacturing, construction, retail and services all saw confidence fall this month. The biggest change was in manufacturing with a decline of 31 points to 31%, a two-year low. Retail sentiment fell 17 points to 40%, its lowest level in four months.

Similarly, confidence in the service sector fell six points to 47%, the lowest reading since April. Construction continued to decline for the fourth consecutive month, dropping 5 points to 35%. 

Martyn Kendrick, Scotland director at Bank of Scotland Commercial Banking, said: “Despite a fall in confidence, Scottish firms remain focused on growth – planning to invest in their people, evolve their products and services, and explore new technologies.  

“As we head into the busy festive trading period, we’ll continue to support businesses across Scotland as they take the next steps in their strategies.” 

Hann-Ju Ho, Senior Economist, Lloyds Commercial Banking, said: “While increased market volatility earlier in the month may have impacted confidence,  levels of trading prospects and economic optimism remain above their long-term averages.

“Businesses may find reassurance that the Bank of England is expected to reduce interest rates further in the next six months, while long-term global bond yields have calmed which, if sustained, may have a positive impact on businesses as we move into the last few months of the year.” 

Paul Kempster, Managing Director for Commercial Banking Coverage, Lloyds Business and Commercial said: “While business confidence has returned to levels seen earlier in the year, a range of metrics remain well above the long-term average. 

“Businesses still have opportunities ahead, whether that be upskilling their workforce, evolving their products or exploring new markets.” 

Scottish business confidence dips in June

  • Business confidence in Scotland fell five points to 47% in June 
  • While firms’ optimism in their own trading prospects fell 10 points to 47%, their optimism in the economy held steady at 48% 
  • However, a net balance of 55% of Scottish businesses expect to increase staff levels over the next year, up 25 points on last month  
  • Overall UK business confidence increased one point in June to 51% 

Business confidence in Scotland fell five points during June to 47%, according to the latest Business Barometer from Bank of Scotland. 

While Scottish firms’ optimism in the economy held steady month-on-month at 48%, businesses reported lower confidence in their own trading prospects, down 10 points at 47%. Taken together, this gives a headline confidence reading of 47% (vs. 52% in May). 

However, a net balance of 55% of Scottish businesses expect to increase staff levels over the next year, up 25 points on last month. 

Looking ahead to the next six months, Scottish businesses identified their top target areas for growth as evolving their offering, for example by introducing new products or services (53%), investing in their team, for example through training (48%) and entering new markets (41%).  

The Business Barometer, which surveys 1,200 businesses monthly and which has been running since 2002, provides early signals about UK economic trends both regionally and nationwide.  

National picture

Overall, UK business confidence increased one point in June to 51%.  

Firms’ optimism in their own trading prospects strengthened one point to 57%, while their confidence in the wider economy also rose one point to 45%. 

Wales was the most confident UK nation or region in June (67%), followed by London (64%).  

Sector insights

Business confidence in the manufacturing and retail sectors saw significant gains this month, with 12-point rises in both sectors to 52%. For manufacturing, this demonstrates an 11-month high.  

Construction and services however saw decreases in confidence, with falls by five points and four points respectively.  

Martyn Kendrick, Scotland Director at Bank of Scotland Commercial Banking, said: “Despite lower overall confidence, Scottish businesses are still setting out plans for growth – whether that’s through plans to hire, or steps like launching new products and services.

“We remain ready to support every step of their journeys.” 

Hann-Ju Ho, Senior Economist, Lloyds Commercial Banking, said: “Business confidence has continued its positive momentum, following the significant gains we saw in May. 

“In particular, the sustained rise in hiring intentions suggests that while firms do still face challenges, they may be starting to look beyond short-term staffing needs and preparing for future growth.” 

Paul Kempster, Managing Director for Commercial Banking Coverage, Lloyds Business & Commercial said: “June’s figures for UK businesses shows a sustained picture of growth and opportunity.

“Overall, while there have been some fluctuations, it’s encouraging to see all regions and nations well above the long-term average.   

“As business confidence continues, we are committed to supporting businesses with a range of financial services to help them achieve their growth ambitions.”