As part of our ongoing research programme, the Scottish Chambers of Commerce conduct a quarterly business survey, run in partnership with the University of Strathclyde’s Fraser of Allander Institute, which takes the pulse from our membership on their experience of economic conditions each quarter.
Our research focuses on five key sectors: Construction, Financial and Business Services, Manufacturing, Tourism and Retail.
Some of our results this quarter were surprising, and displayed evidence of resilience and positivity towards the future from our membership.
As an example, our research showed that generally, optimism was rising across our respondent businesses in the vast majority of sectors covered, with the retail sector the only segment which showed declining optimism across the respondent base.
Retail stood out as a key sector of concern, with sales revenue and cashflow continuing to decline across the year, emphasising the need for the traditionally strong fourth quarter to provide the sector with a much-needed boost.
Currency effects acted to provide a boost to the Tourism sector, with businesses reporting that visitor numbers had increased from outside the UK, both from the EU and from the Rest of the World.
The Financial and Business Services sector (which includes Oil and Gas) also displayed encouraging results, with sales and profitability figures rising to their highest levels for several years. Meanwhile, results in the Construction sector pointed to increased fragility, which has been supported by research such as the PMI and recent data from the ONS. Despite sustained negative growth which technically points to a recession in the industry at a UK level, output has remained at relatively high levels.
One of our points of focus in this research was the consistent levels of recruitment difficulties which have remained above trend for the majority of our analysed sectors. This links to ONS data which confirms that the unemployment rate has remained at its lowest level since 1975. With this in mind, Neil Amner, President of Glasgow Chamber of Commerce and Chair of the Scottish Chambers of Commerce Economic Advisory Group, which oversees the Quarterly Economic Indicator said: “For many of our industries, recruitment difficulties continue to sit above the long term trend levels, exacerbated by the record high employment figures. Concerns continue to be raised by our members when it comes to seasonal workers and the attractiveness of the UK to EEA migrants during the uncertainty surrounding the Brexit negotiation process.
“Furthermore, members in more traditional industries have highlighted issues in attracting younger workers. Businesses in sectors such as manufacturing must do more to reimagine their workplaces to attract future talent, by focusing on increasing autonomy and flexibility in their working practices.”
The Scottish Chambers of Commerce have continued to highlight these labour force difficulties through a number of avenues, including our submission to the Migration Advisory Committee.
Fieldwork for our Q4 QEI will begin in mid-November, if you wish to ensure the voice of your business is heard at a national level, get in touch with Shane Taylor by emailing staylor@scottishchambers.org.uk.
