Rise in Scottish business confidence

There has been a rise in business confidence in Scotland since December’s general election according to a survey of 500 businesses.

The latest Scottish Business Monitor, produced in a partnership between the Fraser of Allander Institute and law firm Addleshaw Goddard, found expectations of growth in the Scottish economy over the next year have also improved.

Businesses remaining cautious about how Brexit negotiations could impact on them, with knock-on implications for investment, staffing and growth.

New business activity remains weaker than a year ago, but expectations of future new business looking optimistic across all sizes of enterprise.

The survey found that expectations of future business activity and turnover over the next six months are at the highest level since the second quarter of 2014.

Graeme Roy, director of the Fraser of Allander Institute, said: “Whilst there is little evidence of a significant ‘Boris bounce’ in Scotland, the results of this post-election Scottish Business Monitor show some signs of a turnaround in sentiment within Scotland’s business community.

“The survey results show a shift away from firms reporting that they see the outlook as ‘weak’ to one where they are now ‘moderately optimistic’ about what the next six to 12 months will bring.

“So perhaps no cause for major celebration – particularly with many businesses reporting ongoing concerns about how the Brexit negotiations may evolve over 2020 – but a welcome finding after a challenging 2019.”

The FAI Business Activity Index, a measure of Scottish business activity, remains unchanged since the last quarter (5%), just below the three-year average (8%).

The net balance of +5 indicates that, on average, Scottish businesses experienced continued growth in the latest quarter.

The majority of businesses, particularly large businesses, expect turnover in the coming months to be higher than lower.

Graeme Roy, director of the Fraser of Allander Institute.