Scottish Chambers of Commerce have today (Thursday) released their Business Survey results for the first quarter of 2014. This broadly based survey, now in its 30th year and conducted in conjunction with the University of Strathclyde’s Fraser of Allander Institute, reported that almost all key performance measures have returned to 2007 pre-recession levels, although some fragilities remain. Liz Cameron, Chief Executive of Scottish Chambers of Commerce said:
“The hard work and determination of Scottish businesses is yielding positive outcomes for the growth of Scotland’s economy. All the indicators in this survey point to sustained economic growth as key sectors increase investment to expand activity, boosted by higher levels of business optimism.
“Investment intentions of Scottish businesses are encouraging with the manufacturing industry showing superb results with higher levels of investment than at any time in the past 6 years and robust growth in export orders shown by a consistent increase over 5 consecutive quarters. Whilst investment levels in the construction sector remain low, for only the second time in 5 years investment has not declined, and over 70% of businesses in the sector have either maintained or increased commercial and domestic orders compared with the last quarter. Promisingly, almost 90% of construction businesses surveyed expect employee numbers to remain the same or increase in the next 3 months and less than 14% reduced employment in the previous quarter.
“Higher levels of business optimism in construction, wholesale, retail and tourism is a positive signal for continued growth, as all sectors reported higher levels of confidence in Q1 2014 compared with the same quarter last year.
“However, despite these positive indicators, challenges still remain. The retail industry is expecting a decrease in profitability in 2014 which may point to stalled consumer confidence and seasonal patterns, but benefit may be drawn from positive growth in the tourism sector as confidence levels among hotels remained high and a rise in the use of conference facilities was also reported.
"The issue of skills shortages is becoming more prominent as businesses look to expand and invest. Businesses in the manufacturing sector are reporting difficulties in recruiting skilled & technical staff and the tourism sector are also reporting difficulties in recruiting managerial staff and chefs. It is vital that the organisations responsible for the development of skills provision, actively work with the business community to ensure employees are provided with the skills required to succeed.
“The buoyancy and optimism of Scottish businesses is to be commended but Governments in Scotland and the UK must facilitate opportunities for businesses to access affordable finance, particularly as cash flow remains a pertinent issue for businesses in construction and manufacturing. Alongside this, efforts to export internationally must be strengthened by policy makers to enable Scottish businesses to take advantage of global trade opportunities.”