Business News Round Up (11/03/2022)
UK economy rebounds in January
Britain’s economy rebounded much more than expected in January from its coronavirus-related lull in late 2021, according to data released this morning. The Office for National Statistics said gross domestic product grew by 0.8% in month-on-month terms in January after a 0.2% decline in December. All the main sectors of Britain’s economy grew by more than expected after the Omicron wave of coronavirus hurt the economy in December, with the wholesale and retail sector as well as pubs and restaurants being particular drivers, the ONS said. The British economy now stands 0.8% larger than its pre-pandemic level in February 2020 but it remains about 4% smaller than if it had continued growing at its trend rate for the last decade. Alpesh Paleja, CBI Lead Economist, said: “Omicron continued to weigh on growth at the start of the year. While the economy has recovered since, it’s clear that causes for concern are growing quickly. Conflict in Ukraine is putting considerable pressure on energy and commodity prices, which, if sustained, will push inflation even higher than expected. The need to press ahead with deploying new power generation through renewables, nuclear and increasing storage capacity, remains acute.”
More than half of Scottish businesses are trading behind expectations in 2022
New research from accountancy firm BDO indicates that Scottish businesses are behind targets for 2022. Companies citied inflation and supply chain pressures as the greatest challenges for the year ahead. However, more than half of mid-sized businesses in Scotland think they will return to pre-COVID-19 revenues in less than 12 months. The bi-monthly Rethinking the Economy survey of 500 medium-sized businesses revealed that nearly a third (29%) of medium-sized businesses in the region intend to increase the prices of their goods or services to manage inflation and support growth. Despite the challenges, nearly one in five companies plan to increase their headcount above pre-pandemic levels in 2022. When it comes to people, 41% of businesses fear a shortage of workers able to work the hours their business requires and 20% have offered non-monetary benefits such as additional holidays to attract and retain the best talent.
UK shares jump on strong economic growth; mid-caps track best week in a year
UK shares rose on Friday after data showed a better-than-expected economic growth in Britain, with the mid-cap index on course for its best weekly performance in more than a year. The blue-chip FTSE 100 index gained 0.8% in early trading, rising 2.5% so far in the week. The FTSE mid-cap index climbed 1.1% and was on track for its best week since February 2021. Britain’s economy rebounded much more than expected in January from its coronavirus-related lull in late 2021, according to data that likely adds to the case for Bank of England policymakers to raise interest rates next week. Energy stocks were up 2.1%, rising 5.8% so far this week, supported by a rally in crude oil prices following Russia’s invasion of Ukraine. Among individual stocks, Avast fell 0.7% after the cybersecurity firm joined a growing number of Western companies in suspending operations in Russia and Belarus following Moscow’s invasion of Ukraine.
Scottish Government proposals could ban companies from dumping unsold goods
Companies could be banned from dumping unsold products that are still in good order. The Scottish Government will include the measure as part of the consultation on its new Circular Economy Bill, which is due in May. Ministers believe such a move would address public concerns about unsold products being destroyed or ending up in landfill. Instead, retailers would be forced to consider other alternatives, such as donating unsold items, or recycling them. France has recently brought in such a ban, with the European Union also considering a similar intervention. Circular economy minister Lorna Slater said: “It is absolutely senseless for perfectly good products to end up in landfill – rather than being wasted in landfill or incinerated, they should be reused or repurposed.” The minister spoke out ahead of a visit to Fresh Start in Edinburgh, where white goods and household items that have been donated by companies are given to help those who have been homeless as they move into a new property.
https://www.insider.co.uk/news/scottish-government-proposals-could-ban-26441057