Business News Round Up (10/08/2020)
RBS survey points to signs of hope for Scotland’s private sector economy
The Scottish economy showed signs of stabilisation during July as the downturn in the private sector began to ease. The latest Royal Bank of Scotland PMI, which combines measures of manufacturing and services sector output, registered a value of 49.3 last month, up from 37.1 in June. It signals the lowest fall in output since the country first entered lockdown in March. Confidence amongst Scottish firms also strengthened to a five-month high, with many linking it to the gradual lifting of lockdown measures beginning an economic recovery. However, a sixth consecutive reduction in Scottish private sector employment was recorded in July. Temporary business closures and weak demand conditions amid the pandemic were frequently cited as reasons behind the latest fall.
One in three firms plant to cut jobs by October
More than one in three private sector employers plan to axe jobs in the next two months, according to research by the Chartered Institute of Personnel and Development (CIPD) and recruiter Adecco. The survey found 38% of UK private sector firms plan to make redundancies, a 50% increase on the number of employers expecting to cut jobs three months ago. The latest survey suggests the jobs market will continue to shrink through the summer quarter, with the number of employers expecting to hire workers falling further below the number planning for redundancies. The news comes as the Centre for Retail Research (CRR) reported 22,039 jobs have been shed by restaurants so far this year. That is almost double the figure of 11,280 for the whole of 2019. The figures revealed 1,467 restaurants have closed over this period, a 59.1% increase on the total 922 sites which closed during 2019.
https://www.insider.co.uk/news/one-three-firms-plan-cut-22495718
North West business activity rebounds sharply as demand picks up, latest NatWest PMI shows
Business conditions improved across the North West private sector in July, with activity showing a steep rebound, according to the latest PMI data from NatWest. The North West Business Activity Index reported a score of 57.4 in July, up from 48.4 in June. This was the first reading above the 50.0 no-change mark since February, indicating a further marked improvement from a record low of 19.7 in April as businesses continued to resume operations. The rise in business activity, which was led by especially strong growth in manufacturing output, was the steepest recorded since January 2018 and fractionally quicker than the UK average.
https://www.business-live.co.uk/partners/north-west-business-activity-rebounds-18728462
Business lending surges to 13-year high – report
The number of loans from banks to businesses is expected to rise by almost 15 per cent this year, the highest level in 13 years, according to an EY ITEM Club Interim Bank Lending Forecast. The forecast shows that business lending is expected to rise 14.4% in 2020, with many firms only forecast to be able to start to reduce their borrowing from 2022. However, the lockdown has caused a significant slowdown in bank lending to households. Demand for consumer credit is predicted to fall by 15.9% in 2020 – the biggest annual fall since records began in 1993. Mortgage lending is forecast to rise, but only by 2.6%.
https://www.insidermedia.com/news/north-west/business-lending-surges-to-13-year-high-report