Business Confidence 'Below UK Rate'
28 August 2014, 07:13
Confidence among businesses in Scotland has fallen below the UK average despite a rise in sales, according to a new report.
The latest ICAEW/Grant Thornton UK Business Confidence Monitor (BCM) recorded a confidence index score of +15.1, well below the national average of +32.3.
The Scottish score is the lowest since the first three months of 2013, the report found.
Firms are also facing problems as competition for skilled employees intensifies, analysts said.
The proportion of businesses reporting that skills availability is more of a challenge now than a year ago rose to 18% this quarter from 7% a year ago.
Meanwhile, the volume of sales rose by 4.5% over the last 12 months and exports were up by 4.9%.
Capital investment was also up by 3.9%, an increase from the 1.6% recorded a year ago.
Kevin Engel, Grant Thornton UK's managing partner in Scotland, said the latest findings were "slightly concerning'' but not surprising.
He said: "Earlier this year, business confidence in Scotland rose to record levels buoyed by a resurgence in economic activity.
"Recovery takes time and presents its own challenges - from accessing capital for growth to finding and adequately rewarding a skilled workforce.
"There are some clear positive elements to our latest findings. Businesses continue to report strong sales growth with exports now outpacing the rest of the UK.
"There are some clear areas of concern for Scotland's businesses, but the long term outlook remains positive.''
ICAEW Scotland president Paul Adderley, added: "Despite positivity in areas such as growth, factors such as the recently reported increase in the number of insolvencies show that whilst there are positive signs, there is still some way to go before we fully return to where we were pre-crisis.''