Business News Round Up (13/11/2023)
UK GDP stalls between July and September
UK GDP stagnated through the months of July to September after experiencing a 0.2% increase in the previous quarter according to the Office for National Statistics (ONS). While there was an estimated single percentage point fall in output throughout the services sector, there was a 0.1% increase in construction output. Commentators noted that the pressure of high interest rates could likely be the cause of struggles in the services sector as households are forced to cut back. Compared to Q3 in 2022, GDP has increased by an estimated 0.6% and the implied GDP inflator, a measure which compares current dollar value to its real value, rose by 7.9%, due to a fall in the implied price of imports. Month to month, UK GDP is estimated to have fallen 0.6% in July before increasing by 0.1% in August and 0.2% in September.
Scottish private sector downturn worsens in October
The latest Royal Bank of Scotland PMI® survey signalled a second monthly deterioration in private sector activity during October. Moreover, the headline Scotland Business Activity Index – a measure of combined manufacturing and service sector output – fell to 46.5 from 49.3 in September, indicating the sharpest decline since November last year. Worsening underlying demand conditions and the cost-of-living crisis were said to have contributed towards the latest fall in output. Additionally, the downturn across Scotland was more pronounced than that recorded for the UK as a whole. Despite souring business conditions, Scottish private sector firms increased their workforce numbers in October. The rate of job creation was the fastest in five months. and the quickest seen of all the UK nations and regions.
North West profit warnings down by a quarter in Q3
Profit warnings issued by listed companies in the North West fell by a quarter year-on-year in Q3 2023, according to research by EY-Parthenon. Six profit warnings were issued by UK-listed companies in the North West during the quarter, down from eight in the same period last year, according to EY-Parthenon’s latest Profit Warnings report. Half of the profit warnings issued by listed businesses in the North West during Q3 2023 were from companies operating in industrial sectors. Similarly, industrial companies issued the second-highest number of warnings across the UK (20), with only consumer discretionary companies (21) issuing more. The number of profit warnings issued by listed companies based in the North West during Q3 2023 represented a quarter-on-quarter increase, with five warnings issued by companies in the region in Q2 2023.
https://www.insidermedia.com/news/north-west/north-west-profit-warnings-down-by-a-quarter-in-q3
Scottish employers ‘hesitant about generative AI’
With skills shortages continuing to persist across Scotland, organisations are increasingly turning to technology – by introducing or increasing automation – to help plug the gap. However, when it comes to generative artificial intelligence (AI), 36% of Scottish employers see privacy and security concerns as potential drawbacks to its use. Only a fifth don’t think there are any potential drawbacks to their organisation. The Chartered Institute of Personnel and Development’s (CIPD) latest Labour Market Outlook also revealed that 13% of Scottish employers have banned the use of generative AI, with a further 5% planning to do so. In response, the professional body for HR and people development has urged employers to look at the benefits of AI, or risk being outpaced by technology.
https://www.insider.co.uk/news/scottish-employers-hesitant-generative-ai-31410265