Finance secretary John Swinney today insisted that Scotland’s economy is outpacing the rest of the UK as it emerged demand for staff has reached a record high and business confidence has risen for the tenth month in a row.
However, retailers were warned they could face a “challenging” Christmas after a new report showed the number of shoppers on Scotland’s high streets continued to fall last month, although industry watchers said canny consumers may be holding out for a last-minute rush.
Bank of Scotland chief economist Donald MacRae said the number of people placed into permanent roles last month grew at its fastest rate since the bank started collecting data almost 11 years ago, boosted by strong demand in the IT and computing sector, while demand for temporary workers hit a six-year high.
MacRae added: “Employers are demonstrating their growing confidence in the continuation of the recovery in the Scottish economy.”
But the Federation of Small Businesses said many companies were struggling to find suitably-skilled people to fill their vacancies and help fuel their growth ambitions. Scottish policy convenor Andy Willox said: “If we’re going to get more people back to work while growing our businesses, the country’s educational decision-makers need to do more to boost work-readiness.”
Meanwhile, figures from accountant BDO revealed that business confidence north of the Border continued to improve in November, driven by the services sector, which accounts for more than three-quarters of economic output.
Martin Gill, head of BDO in Scotland, said: “I think we can finally say that the key economic battleground has shifted from austerity to the new debate about how the government can help businesses achieve sustained growth in the context of a dynamic, internationally competitive economy.”
Swinney said the Scottish Government’s decision to cap annual increases in business rates at 2 per cent, announced last week, would help to “preserve the competitive advantage” enjoyed by Scottish firms. He added: “Our economy continues to grow and is outperforming the rest of the UK, maintaining Scotland’s position as the best place to do business.”
Although today’s footfall monitor from the Scottish Retail Consortium (SRC) and data firm Springboard showed the number of shoppers venturing out last month was 0.3 per cent lower than a year ago, the figures marked an improvement on the pervious month’s 2.7 per cent slide, and were in sharp contrast to the UK-wide decline of 2.9 per cent.
SRC head of policy David Martin said: “Many customers remain cautious and cash-conscious and may have been holding off on much of their seasonal spending until December ushered in the final countdown to Christmas.”
Howard Archer, chief UK economist at IHS Global Insight, said shoppers are under pressure from rising prices and low wages growth, and may be waiting to see whether stores blink first and started rolling out promotions.
He said: “Consumers will be very well aware that in recent years, many retailers have engaged in serious discounting in the final few days before Christmas, with some shops even starting their clearance sales, and many people will be hoping that several retailers do the same again this year.”