Economic recovery is ‘firmly embedded’ in Scotland

Salaries indicate confidence is growing, said Donald Macrae
Salaries indicate confidence is growing, said Donald Macrae
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The recovery finally became “embedded” north of the Border last month as the latest Bank of Scotland survey showed jobs being created at an almost record rate.

The bank’s purchasing managers’ index (PMI) for June, published today, shows a rebound in private sector growth after May’s 13-month low.

Bank of Scotland’s chief economist Donald MacRae said: “Growth was evident across both manufacturing and services, with business services leading the way.

“After four months of decline, new export orders stabilised while levels of new business rose across the economy.

“Employment growth was accompanied by rising salaries, providing further evidence of increasing confidence. The recovery in the Scottish economy is now firmly embedded.”

The headline PMI figure climbed to a three-month high of 55.9, with a stronger inflow of new business at Scottish
private companies, underpinning growth.

Meanwhile, new export
orders at manufacturers stabilised in June, a relative positive after four successive months of declining international sales.

Employment in the private sector economy rose strongly, at the second-fastest rate since the survey’s inception in 1998. Driven by both manufacturing and services, the speed of job creation was the most marked since February’s record high.

Salary increments were the main factor behind an increase in costs.

Businesses raised output prices to cover at least part of the burden, and inflationary pressures in Scotland remained
notably higher than across the UK as a whole.