Business News Round Up (12/12/2022)
UK manufacturing investment set to fall as recession looms
Investment in British manufacturing is set to fall for the first time in nearly two years as companies start to cut spending as a recession looms next year. Make UK, the trade body, said the balance of its members reporting an increase in investment intentions during the past three months of the year dropped to minus 5 per cent from plus 7 per cent. This was the first time in seven quarters, since the height of the coronavirus pandemic, the measure had turned negative. The quarterly Make UK/BDO Manufacturing Outlook survey published on Monday also forecast output would fall 4.4 per cent this year, compared with a “very strong” 2021, and warned further declines would follow. In its September forecast, Make UK had still anticipated growth of 0.6 per cent for the year and said the change in outlook highlighted “the extent to which conditions for the sector have weakened significantly, especially in the final quarter of the year”. It added that it expected a contraction of 3.2 per cent in 2023 as the UK entered recession. The balance of manufacturers reporting an increase in orders also fell sharply in the final quarter, from 15 per cent to 6 per cent, with the measure dropping to minus 2 per cent for the first three months of 2023. The data will add further pressure on to the government to find ways to stimulate business investment, with companies across the country warning they will rein in spending as economic conditions worsen.
https://www.ft.com/content/9faf9646-0110-407c-9bdb-093fa2d70f71
Almost three quarters of Scottish employers hiring unskilled staff to address shortages
Almost three quarters of employers in Scotland (71%) have said that, to address skill shortages, they would be willing to employ staff without the necessary skills, while more than a fifth (22%) have increased their training budget to focus on up-skilling staff. Between the end of August and the end of September, recruitment firm Hays surveyed 13,421 professionals and employers across the UK, including 900 from Scotland, finding that as 94% of Scottish employers have experienced skills shortages in the past 12 months. Despite current economic uncertainty, 83% of employers in Scotland are still planning to hire staff, which is slightly higher than the number reported this time last year. Hays Scotland director Keith Mason said that means there’s currently a real need for employers to look outside their usual recruitment pool to fill posts. “They should consider hiring staff from other related sectors or professions, and work to retrain staff with potential, while boosting their training budget to up-skill existing staff. It’s also really important that employers aim to attract talent from south of the border or abroad – many professionals may have studied and begun their career in Scotland, then moved away for other opportunities – we need to encourage that talent to migrate back here.”
https://www.insider.co.uk/news/almost-three-quarters-scottish-employers-28710351
Private sector business activity declines, while prices rise
Business activity continued to fall across the North West’s private sector economy during November, in line with signs of further weakness in demand for goods and services, the latest Regional PMI data from NatWest showed. Elsewhere, the survey signalled that firms’ input costs and output prices continued to rise sharply, albeit at slower rates than in recent months. The headline North West PMI Business Activity Index – a seasonally adjusted index that measures the month-on-month change in the combined output of the region’s manufacturing and service sectors – registered 48.5 in November, little-changed from October’s 48.4. A reading below 50, which signals falling business activity, has now been recorded in each of the past three months. The modest decline in output was led by weakness in the manufacturing sector. November saw a fifth straight monthly decline in inflows of new work across the North West private sector, highlighting a sustained weakening in underlying demand for the region’s goods and services. Uncertainty among customers and high inflation were the main two factors weighing on sales activity, anecdotal evidence showed. Furthermore, the rate of decline in new orders continued to gather pace, reaching the quickest since January 2021 and outstripping the UK average.
Scotland ahead of rest of UK in creating green jobs
Scotland is creating a higher proportion of new green jobs than anywhere else in the UK, researchers have found. Roles deemed to have a positive environmental impact made up 3.3 per cent of all job adverts in Scotland in the 12 months to July, up from 1.7 per cent in the previous period. That meant Scotland retained first place in the Green Jobs Barometer published by PwC, the accountancy and business advisory group. The study, first launched in November 2021, tracks movements in green job creation and losses, the carbon intensity of employment and worker sentiment across sectors. It found the number of green roles advertised in the UK almost trebled year on year and was equivalent to 336,000 positions. While Scotland had the highest proportion of jobs, the total number of positions, 24,610, was behind many other places. London and the southeast of England dominated that measure, with more than 110,000 roles. Scotland’s energy sector was found to be the prime driver of green jobs with growing numbers of positions in offshore renewables. The report pointed out the potential for further growth in areas such as carbon capture, usage and storage and hydrogen in the coming years.
https://www.thetimes.co.uk/article/scotland-ahead-of-rest-of-uk-in-creating-green-jobs-8bwrmtmqf