Scottish businesses ‘joint most confident’ in May

A net balance of 50% of businesses in Scotland also expect to increase staff levels over the next year, up eight points on last month.

Looking ahead to the next six months, Scottish businesses identified their top target areas for growth as investing in their team, for example by investing in training (44%), evolving their offering (40%) and introducing new technology (36%).

There were particularly strong results reported in the construction and services sectors this month.

Prospects in the construction sector jumped to 58% – up 20 points – the highest for 14 months, while in services, expected output increased to 57% – up 12 points. On the latter, it is the highest level since the survey was expanded in 2018. Expected business activity in the retail sector also improved to 49% – up three points.

Although trading prospects in manufacturing eased slightly to 49% – down three points – the underlying trend over the last three months remains positive.

Martyn Kendrick, director for Scotland at Bank of Scotland Commercial Banking, said: “Along with longer nights and warmer days, summer is ushering in a new wave of confidence among Scottish businesses.

“As firms look ahead to new growth, it’s essential that they have the right strategy and resources in place to capitalise on new opportunities.”

Hann-Ju Ho, senior economist at Lloyds Bank Commercial Banking, added: “Optimism about the economy increased to 46% this month – the highest result since September 2021, when the country was emerging from the Covid-19 pandemic, but before the energy crisis after the invasion of Ukraine.

“The regional picture has also improved – we’ve now seen increases in seven of the UK’s 12 regions, where there was previously a more mixed picture.”

Don’t miss the latest headlines with our twice-daily newsletter – sign up here for free.