Collapse in Scottish business confidence

Businesses in Scotland are the least confident in the UK, according to a new survey published today.

The monthly Bank of Scotland Business Barometer shows that overall confidence among Scottish firms fell nine points to -18% in September.

Firms’ confidence in their own business prospects dropped to -5%, compared with 0% in August.

Across the UK, overall confidence rose one point to 2% as firms’ confidence in their own future climbed five points to 13%.

Fraser Sime, regional director for Scotland at Bank of Scotland Commercial Banking, said: “Ongoing uncertainty continues to challenge many businesses, but there are always some sectors that can prosper in the environments we are experiencing.

“We are by the side of business and recently pledged to lend £1.6 billion over the next year to support Scottish firms to capitalise on opportunities to upscale and succeed. Despite confidence levels dipping, we are optimistic that they will bounce back once firms get a degree of clarity over their future trading environments.”

Across Scotland, a net balance of 32% of businesses said they felt that the UK’s exit from the European Union was having a negative impact on their expectations for business activity, down six points on a month ago.

Overall confidence remained the weakest in the manufacturing sector, where it fell by five points to -2%, and the services sector, which remained unchanged at -3%.

Confidence in the retail sector rose by eight points to 14%, but fell two points in the construction sector to 10%.

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

Businesses in the East Midlands showed the most confidence, at 15%, ahead of the West Midlands and Yorkshire (both on 7%).

Fraser Sime, regional director for Scotland at Bank of Scotland Commercial Banking.