Business News Round Up (21/11/2022)
UK businesses call for looser immigration rules to boost growth
Britain should create a programme of temporary work visas to boost economic growth and also resolve a dispute with the European Union over trade rules in Northern Ireland, one of the country’s leading business organisations said on Monday. “We don’t have enough Brits to go round for the vacancies that exist, and there’s a skills mismatch in any case,” Confederation of British Industry Director-General Tony Danker said ahead of the organisation’s annual conference. “Let’s have economic migration in areas where we aren’t going to get the people and skills at home anytime soon. In return, let’s make those visas fixed-term,” Danker said. Prime Minister Rishi Sunak is due to address the CBI conference later on Monday, but his immigration minister, Robert Jenrick, said the government’s aim remained to cut the number of foreigners coming to Britain. “Overall, our ambition is to reduce net migration. We think that’s what the British public wants. That was one of the driving forces in the votes to leave the European Union back in 2016,” Jenrick told Sky News. The number of EU migrants in Britain has fallen sharply since the referendum and the introduction in 2021 of visa rules that no longer favour them over migrants from the rest of the world. While the number of non-EU migrants has risen to fill the gap, businesses say the work visa system is less flexible than the previous free movement allowed for EU citizens, and stops them hiring low-paid workers.
Work from home falls as hybrid model takes hold
Working from home is in decline with the number of Scots now operating remotely dropping to its lowest as the economy recovers from the Covid pandemic. In the first fortnight of October, just 5% of workers were exclusively working from home, according to a survey of more than 1,000 Scottish businesses. That compares to 15.7% at the turn of the year and represents a gradual reduction in those only logging in from home. The Office for National Statistics’ Business Insights and Conditions Survey reveals that 28.4% of large businesses were now adopting a “hybrid model of working” – where staff split their working week between home and the office. This is nearly double the rate at the beginning of 2022. Public speaking and hybrid working specialist Gavin Brown, who runs Edinburgh-based Speak with Impact, said the figures signalled a further change in post-Covid working patterns. The former MSP said businesses across the country could capitalise on hybrid working, especially when it comes to maximising opportunities overseas. Among the Scottish sectors most likely to adopt hybrid working are information and communication (50.6%), and professional, scientific, and technical activities (49.8%). The statistics showed that between 3 and 16 October 28.4% of those working for businesses with more than 250 employees were hybrid working, compared to 16.3% of small and medium-sized firms. The BICS began monitoring hybrid and home working results from Scotland in November 2021.
The number of UK sectors with falling output ‘highest since May 2020’
The number of UK sectors experiencing falling output was at its highest level in 29 months in October, as demand for goods and services decreased. The latest Bank of Scotland UK Sector Tracker revealed that last month 12 out of 14 sectors recorded a contraction in output, up from nine in September and the highest number since May 2020; when the UK was first in lockdown. Output contraction was caused by falling demand, with 13 of the 14 sectors recording a decrease in new orders in October, up from nine in September, as rising inflation caused more businesses and consumers to rein in spending and investment. Demand for goods in the chemicals (29.5), metals and mining (31.1) and household products (38.4) manufacturing sectors fell at the fastest rate in October. A reading below 50 indicates contraction, while a reading above 50 indicates expansion. Providers of software services was the only sector monitored to see increased demand (59.7) in October. As a result, the sector recorded the strongest output growth (60) of any sector, followed by food and drink (58.4). The food and drink sector also saw the slowest fall in demand (49.9) of any manufacturing sector. Since July, more than half of the UK sectors monitored by the tracker have consistently reported falling output and demand. There were also early signs of a labour market slowdown in the UK. Employment (52.4) rose at the slowest rate in 20 months in October, while the overall manufacturing sector recording its first drop in headcount since December 2020.
https://www.insider.co.uk/news/number-uk-sectors-falling-output-28543435
Law firm CMS and Fraser of Allander launch new campaign in Aberdeen to maximise Scots economic growth potential
Law firm CMS and think tank Fraser of Allander Institute have launched a new campaign aimed at bringing together Scotland’s business community, government and policy groups to maximise the nation’s economic growth potential. The initiative began with a release of a new report highlighting some of the core opportunities for Scottish business, trade, and tourism to excel on the international stage. The International Scotland report sets out how the nation punches above its weight in key sectors such as renewables, tourism and food and drink. It also recognises the strength of the Scottish university sector in supporting new, innovative companies and highlights how Scotland is an ideal location to attract international talent. The report also looked at challenges – not least in the north-east which is grappling with the challenge of decarbonising its oil and gas sector while ensuring jobs are not lost, a task it said would not be easy. The report said: “The big question is how an area such as Aberdeen can attract non-oil business on account of its skills base and infrastructure. The high skill, high-productivity jobs associated with the North Sea are unlikely to be easily replaced in the local economy but, the repurposing of existing infrastructure, as well as the transfer of workers’ expertise presents opportunities for former oil and gas hubs. Why not use the technology and skills we have for new methods of cleaner production that can be exported internationally?