Business News Round Up (13/04/2023)
UK economy shows no growth in February – ONS
Britain’s economy stagnated in February as strikes by public workers hit output but a bounce in January was stronger than first thought, meaning a recession is a bit less likely to be brewing in early 2023. Economic output was flat in month-on-month terms in February, against the consensus forecast for a 0.1% increase in a Reuters poll of economists. But the Office for National Statistics (ONS) revised up its estimate for January’s growth to 0.4% from 0.3%. This means Britain is likely to avoid the first-quarter contraction that the Bank of England predicted last month. The bigger picture remains weak. While sidestepping recession for the time being, Britain’s economy has stagnated over the last year. International Monetary Fund projections published this week showed Britain bottom of the world’s major economies in terms of expected economic growth in 2023, with a 0.3% contraction pencilled in, equivalent to a 0.7% fall on a per capita basis. Suren Thiru, economics director at accountancy body ICAEW, said recession fears would linger as higher taxes and borrowing costs offset the fall in inflation and government support for energy bills.
https://www.rte.ie/news/business/2023/0413/1376685-uk-economic-growth/
Early retirement ‘driving skills shortage’
Workers taking early retirement form the largest number of people classed as economically inactive and depriving companies of badly-needed skills, according to new research. The figures showed that around 346,000 people aged 50-64 are currently economically inactive in Scotland, which represents the highest number since comparable records began. Over half (52%) of over 50s in Scotland who have left the workforce since the beginning of the Covid-19 pandemic took early retirement. This compares to a UK average of 49%. The Southwest of England had the biggest number of early retirees (57%). Sickness and disability accounted for 19% of workers in Scotland retiring early. Many of those who left work early are also leaving themselves short of a comfortable retirement and may have to return to work in their later years, says Phoenix Insights. Analysis by the group revealed that, at current savings levels, savers could face a shortfall in retirement, as one-third (31%) of adults in Scotland have no pension provision at all. The average pension wealth among 50–64-year-olds in Scotland is £157,500, which is almost £100,000 short of what is needed for a ‘moderate’ retirement income if retiring at the state pension age.
https://dailybusinessgroup.co.uk/2023/04/early-retirement-driving-skills-shortage/
Trade body warns of dent in industry confidence if apprentice fund delays continue
A trade body has warned improving levels in confidence across the food and drink sector could “quickly dissipate” if delays in funding new apprenticeships continue. Scottish Bakers, a membership organisation supporting the bakery trade throughout Scotland, has written to the Scottish Government to express dismay at the delay in confirming funding for new apprenticeships starts. Last week, the Scottish Training Federation (STF) said thousands of young people across Scotland have been “left in limbo” as no new modern apprenticeships will be available “for the foreseeable future” due to delays with government funding. Every April, Skills Development Scotland (SDS) enters contracts with employers and training providers to deliver new modern apprenticeships. But Holyrood has not yet agreed a budget or number of new modern apprenticeships with SDS, according to the STF. Scottish Bakers chief executive Alasdair Smith said the organisation had identified 85 new apprentices to begin training with their members to start in April and May. But Smith warned the organisation has been “unable to move on these learners”.
https://www.insider.co.uk/news/body-warns-dent-industry-confidence-29697634
Glasgow collaborates with UK Infrastructure Bank to accelerate Clyde Metro development
A project that seeks to accelerate the development of Clyde Metro has been agreed between Glasgow and UK Infrastructure Bank (UKIB). UKIB has been working with the council to support the development of financial and commercial plans for the mass transit project which was recently confirmed by the Scottish Government as a key priority for future transport investment. Clyde Metro, which represents a multi-billion-pound investment over a 30-year period, could better connect more than 1.5 million people to employment, education, and health services in and around Glasgow. The relationship with UKIB has arisen through the work of our Green Economy team as part of Glasgow’s Green Deal, a transformative mission to reshape the city’s economy to help deliver equitable, net zero carbon and climate resilient living by 2030. UKIB has provided commercial insights around the investment case for Clyde Metro and ran a series of workshops with regional stakeholders and representatives from the public and private finance sector to explore funding options for mass transit. The pilot project also marks the beginning of a wider strategic relationship with UKIB, who will review our broader net zero investment work and seek to identify further areas for future collaboration or possible lending.