Business News Round Up (19/10/2023)
Business insolvencies in the UK to increase in next few years
In its latest global report, Allianz Trade anticipates that business insolvencies in the UK will hover around 30% above pre-pandemic levels by 2025, with notable peaks expected in 2024 (29,850 cases i.e. +5%) and 2025 (28,400 cases i.e. -5%). The rise is primarily attributed to the hospitality, trade, and manufacturing sectors, contributing to an estimated increase of 16% in 2023, equivalent to 3,900 additional cases. Despite all sectors having largely surpassed 2019 levels, the resilience of domestic firms has been strained by successive shocks and challenges, including Brexit-related issues, the COVID-19 pandemic, earlier monetary tightening, and persistent inflation. The insurer’s latest Global Insolvency Report revealed updated forecasts for 2023 and 2024, with key insights outlining minor rebound in 2022 (+1%) and a surge by +6% in 2023 and +10% in 2024. The acceleration in insolvencies is driven by a recession in corporate revenues, amplified by reduced pricing power and weakened global demand. The revenue recession, registering a decline of 1.9% year-on-year as of Q2 2023, is pervasive across all regions for the first time since mid-2020. Coupled with high costs, this trend is squeezing profitability and rapidly deteriorating liquidity positions, unlikely to improve before 2025.
Workers in Scotland turning to generative AI to boost productivity, new research shows
Workers in Scotland are increasingly turning to generative AI platforms such as ChatGPT in order to boost productivity, new research has shown. Business consultancy Accenture’s latest UK labour force survey has shown office and remote workers are both using the technology – and report increased job satisfaction as a result. The research shows a growing use of generative AI in the workplace, with over four in ten (43 per cent) workers in Scotland using the tools at least once per week, and under one in ten (8 per cent) workers using them daily. Of those polled, 63 per cent of those who have used generative AI tools at work said it made them feel more satisfied about their job. Virtually all (95 per cent) of those who have used the tools say they found them useful. Twenty-four per cent also reported that it made them feel more productive and/or freed up time to do more quality work. Whilst 28 per cent of workers who have never used generative AI tools at work, admitted they don’t yet understand how to use them. For those respondents who have used generative AI tools at work, the most popular tasks which workers north of the Border are currently using generative AI to help them with include research and data analysis (30 per cent), brainstorming (30 per cent), plus administrative and operational processes (21 per cent). Meanwhile 21 per cent of workers in Scotland believe AI tools offer the potential for them to be more productive in the future.
UK to lose out on £98bn of growth by 2030 due to shortage of tradespeople
A national shortage of skilled tradespeople, such as plumbers and electricians, is set to cost the UK £98bn in missed economic growth by 2030, according to new research by Kingfisher, owner of Screwfix, B&Q and TradePoint, in partnership with economics consultancy Cebr. The UK is currently facing a shortage of 166,000 tradespeople, with vacancy levels for many trades close to record highs. The shortfall is forecast to grow to 250,000 tradespeople by 2030 as more homeowners look to improve their property’s energy efficiency by installing measures like insulation, heat pumps or solar panels. The biggest shortages are set to be among electricians, plumbing and heating installers, and carpenters/joiners. The West and East Midlands and London are the regions predicted to be most impacted by tradesperson shortages, with regional GDP growth reduced by £14.5 billion, £12.1 billion, and £11.7 billion respectively. The findings come as a survey by Kingfisher of 1,000 16–25-year-olds2 reveals many young people are missing out on trade careers due to a lack of career advice at schools. Half (49%) of young people said they have never considered a career in the trades, with only one in ten (13%) saying they were encouraged at school to consider trade career options. 42% said they would have liked more information about trade roles before deciding on their career path.
Scottish funding for renewables and green economy
The Scottish Government has announced that it will be using strategic investment to deliver the economic potential of renewables, and the creation of thousands of green jobs. Over the course of the next five years, more than £500 million will be committed by the Scottish Government to support major supply chain opportunities, through the leveraging of private investment in ports, manufacturing, and assembly work. ScotWind could help to deliver up to £25 billion worth of private investment across the supply chain, due to the expectation of a rapid acceleration over the course of the coming years in Scotland’s offshore wind capabilities. ScotWind is currently the world’s largest floating offshore leasing round. Humza Yousaf, First Minister of Scotland, said: “It is essential that we work together to deliver a net zero economy and do so in a fair and just way. No-one – not least our energy workforces and the communities they support – can be left behind.”
https://www.publicsectorexecutive.com/articles/scottish-funding-renewables-and-green-economy