Business News Round Up (20/11/2023)
Scotland to avoid recession despite flat economic performance
Resilient consumer spending may have helped the Scottish economy avoid a recession, but economic growth has been flat since Q2 of 2022 and will remain into 2024 when GVA is expected to rise by 0.3%, according to the EY ITEM Club Scottish Autumn forecast. The forecast adds that sentiment among businesses and households remains fragile against a backdrop of persistent high interest rates and above-target inflation, despite the recent announcement by ONS that inflation appears to be decreasing. Prospects are better for 2025 (GVA expected to rise by 1.3%) and 2026 (GVA expected to rise by 1.5%), with the economy expected to gain momentum. In part due to Scotland’s labour market demographics, growth will remain low in historical terms and is expected to lag the UK as a whole. However, when London is removed from the forecast, Scotland’s expected growth performance is similar to the rest of the UK.
UK retail sales slide again in October in new blow for economy
British retail sales volumes fell unexpectedly in October as consumer finances remain stretched, official data showed on Friday, in a new warning sign for the economy. Retail sales volumes dropped 0.3% month-on-month, following a revised 1.1% decline in September that was worse than first estimated, the Office for National Statistics (ONS) said. Economists polled by Reuters had forecast that sales volumes would rise by 0.3% on the month in October. Overall, the figures fitted with the darkening outlook for Britain’s economy, with economic growth stagnant and strong price pressures fading only slowly. Investors think these factors will force the Bank of England to lower interest rates next year. “Retailers suggested that cost of living, reduced footfall and the wet weather in the second half of the month contributed to the fall,” the ONS said.
Research suggests hybrid working in Scotland ‘levelling out’
The number of employees in Scotland working in a hybrid way (39%) is now levelling out, with 39% also working fully in an office setting. This balance between hybrid and solely office-based work indicates a gradual, but noticeable, swing to full-time office working, according to new research by Hays. However, 22% of professionals in Scotland work fully remotely. The research also showed that 56% of workers would accept a job in the future even if it didn’t offer hybrid working, with 44% stating that they wouldn’t accept a role that didn’t offer a hybrid working approach. The survey of nearly 15,000 professionals and employers – including 886 from Scotland – found that nearly two thirds of employers in Scotland (68%) are offering hybrid working, yet more than a quarter (27%) anticipate their hybrid working offering will change over the next 12 months, and that they will require increased staff attendance.
https://www.insider.co.uk/news/research-suggests-hybrid-working-scotland-31480345
Don’t sleepwalk into a year of low growth and lost opportunities – CBI Chief warns ahead of election campaign
Ahead of the Autumn Statement, and with a general election potentially just months away, CBI Chief Executive Rain Newton-Smith has issued a warning to UK politicians of all stripes that the country can’t afford for 2024 to be shaped by “low growth and lost opportunities.” Against a tough economic backdrop, and with businesses around the world bracing for another challenging year in 2024, Newton-Smith will urge UK party leaders to leverage political consensus on issues like boosting business investment, upgrading infrastructure, and incentivising R&D to tell a more positive growth story. To help the UK “regain its voice”, and set the economy on track for sustainable growth, the CBI has outlined three areas for immediate action: Enterprise; employment and education; and green growth.