Scotland only part of UK to see business confidence dip, says Bank of Scotland

Business confidence in Scotland fell in February, bucking a more positive trend seen in every other part of the UK.

The latest Business Barometer report from Bank of Scotland Commercial Banking found the balance of companies north of the Border feeling positive about future prospects dipped by two points during February to 35 per cent.

Although Scotland is the only UK nation or region to record a lower confidence reading than in January, the figure remains above the long-term average. A net balance of 31 per cent of businesses in Scotland also said they expect to increase staff levels over the next year, up seven points on last month. 

Lloyds Commercial Banking's Scottish regional director Fraser Sime says business confidence remains firmly in positive territory, despite the fall. Picture: Lisa Ferguson.

Fraser Sime, regional director for Scotland at Lloyds Bank Commercial Banking, said: “Despite a slight dip, Scottish business confidence remains firmly in positive territory, and is another sign that firms are welcoming the return to business as usual.

“Many in the hospitality and leisure sector in particular will be happy about the next stage in the easing of restrictions, and looking forward to what will hopefully be a busy summer season.

“Of course some challenges do remain. Rising prices, coupled with ongoing supply-chain issues, will be hampering many businesses, and we'll supporting companies as they overcome these headwinds and set their sights on growth.”

According to the report, overall UK business confidence is at a five-month high, rising five points to 44 per cent. Firms remained positive about their future trading prospects, with a four-point increase month-on-month to 45 per cent, while optimism in the economy overall also increased by five points to 43 per cent. The net balance of businesses planning to create new jobs rose by nine points to 38 per cent.

Paul Gordon, managing director for SMEs and mid-corporates for Lloyds Bank Commercial Banking, said: “The UK’s expected future growth is in positive territory following February’s rise in business confidence, trading prospects, and economic optimism.

“The UK’s construction and manufacturing sectors have seen the biggest benefit as Covid restrictions and supply challenges ease, while the retail sector has also seen a boost in confidence. What is clear is that business confidence is on an upward trajectory.”

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