Scots firms less optimistic than southern peers about economic outlook

Businesses in Scotland are less optimistic than their counterparts further south about the economic outlook in general, according to the inaugural SME Barometer findings from accountancy firm Azets.

The research, which surveyed 401 Azets small and medium-sized enterprise (SME) clients in the UK, revealed that despite the economy, Covid-19 and competition ranking in the top three threats for such firms, 68 per cent feel positive about the UK’s economic outlook in the next year and 56 per cent expect their profits to increase.

Brexit remains firmly on the agenda, named the the third-biggest threat in all regions outside London and the South-east. More than half of all firms surveyed expect to recruit more over the next year and 60 per cent intend in that time.

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Scots labour market 'in good position' after gaining further momentum
Hopefully recovery in confidence in Scotland and the north of England will accelerate, says Azets. Picture: Jeff J Mitchell/Getty Images.

Businesses in Scotland, along with England’s North-east, North-west and Yorkshire and Humberside, are less optimistic than their peers further south about the economic outlook in general. In total, 71 per cent of London and South-east SMEs feel positive about the UK’s economic future, in comparison to 60 per cent in Scotland, for example.

Additionally, 87 per cent said they expect to be trading in a year’s time, although 6 per cent said they’re unlikely to be doing so at that point.

Peter Gallanagh, north regional chief executive of Azets – which earlier this year announced a new office presence in Aberdeen – said: “There is a robust level of optimism across the SME community and the investment and recruitment intentions are very encouraging. Hopefully recovery in confidence in Scotland and the north will accelerate as the economy strengthens across the regions, entrepreneurs start to invest, and employment increases.”

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