In a statement to the Scottish Parliament earlier today, the Cabinet Secretary for the Economy, Fiona Hyslop MSP outlined further measures that the Scottish Government are taking to support more businesses adversely affected by Covid-19:

  • Extending the eligibility of the current small business and retail, hospitality and leisure grant to businesses that occupy multiple premises with a cumulative value above 51k
  • And also to businesses occupying premises such as shared office spaces, business incubators and shared industrial units where the landlord is the ratepayer.
  • In addition, for those businesses that were ineligible to apply for Hardship Funds because they did not have a Business Bank Account, the Scottish Government will be exploring ways of how to support those companies. Further details will be released later this week.

Responding to these measures as outlined by the Cabinet Secretary, Dr Liz Cameron, Chief Executive of the Scottish Chambers of Commerce said:

“The Scottish Government has shown it is listening to the needs of businesses. For those businesses that are still small but operate from expensive premises, this is a lifeline. Likewise, for those that operate from shared office spaces. Whilst gaps still remain in overall business support provision, this intervention is welcome and the government must now ensure that cash gets to businesses in crisis as soon as possible. We look forward to receiving further details later this week.”

The latest Scottish Chambers of Commerce’s Quarterly Economic Indicator survey shows Scottish firms continuing to display resilience in the face of economic uncertainty.

The survey, produced by the Scottish Chambers of Commerce Network in collaboration with the University of Strathclyde’s Fraser of Allander Institute, found growing optimism within manufacturing and financial & business services firms.  However, concerns around investment levels and recruitment challenges suggest that growth may remain fragile in the months ahead.

In a positive development, the retail sector has displayed some evidence of an encouraging fourth quarter, with key financial indicators such as sales and cash flow reported as improved over Q3 2017.  However, this follows a particularly challenging number of years for the sector, and it should be noted that these improvements are coming from a particularly low base relative to our other surveyed sectors.

Reacting to the results, Neil Amner of Anderson Strathern, Chair of the Scottish Chambers of Commerce Economic Advisory Group, said:

“The results of the fourth quarter Quarterly Economic Indicator are broadly positive, and suggest that Scottish businesses are continuing to display positivity in an uncertain economic environment.   

“Firms remain concerned about a range of issues however, with over 87% of manufacturers anxious around the rising costs of raw materials and its effect on their prices. 

“Further, the fact that over half of Tourism respondents indicating business rates as their primary concern, in addition to 40% of Business Services firms citing taxation, suggests that the debate on Income Tax and the wider tax mix in Scotland will continue to be of interest beyond the Scottish budget’s parliamentary approval process.

“Recruitment difficulties have continued to worsen for a number of sectors, particularly manufacturing, tourism and financial and business services, with the latter two sectors close to the highest levels ever measured in the survey.

“Many sectors are continuing to invest in training in an attempt to retain and upskill their existing staff, but it is clear that businesses are finding it challenging to fill vacancies.  This continues to emphasise the need for Government to continue investing in our talent and skills base through initiatives including Developing the Young Workforce and Foundation Apprenticeships. In addition the need for a practical immigration policy to arise from the Brexit negotiations, which puts business first, is made even more critical by these conditions.”

In his foreword to the report, Professor Graeme Roy of the Fraser of Allander Institute comments on the challenges facing Scottish businesses:

With heightened levels of uncertainty, it is unsurprising that investment intentions remain modest, whilst the tight labour market means that many firms continue to report difficulties in recruiting staff. Encouragingly training investment is holding up a little better.”



General / Overall

  • Raw material prices a significant concern
  • Inflation feeding in to price rises / cost pressures
  • Expectations and overall investment slowing in some sectors, suggesting rising uncertainty.
  • Recruitment difficulties persist at record highs for a number of sectors, with training investment maintained at above trend levels.


  • Optimism eased, however this is common in the 4th Quarter.
  • Orders and sales relatively strong in comparison with Q3 2017.
  • Raw materials an issue for 75% of firms, with evidence of pressure on margins with reduced profits.

Financial and Business Services

  • Optimism, profits, sales and expectations all strong.
  • Signs of easing investment.
  • Highest level of recruitment difficulties ever recorded for this sector (47% of businesses).
  • Taxation highlighted as the main concern by 41% of firms.


  • Trends in new orders have eased, but remain positive.
  • Firms appear to be adjusting expectations downwards, which is a slight cause for concern.
  • Capital investment negative for the first time in a number of years, although investment intent high for next quarter.
  • 87% of manufacturers are concerned about raw material prices, with a net % balance of 68% indicating that they will raise prices in Q1 2018.


  • Strong Q4 with more positive results than much of 2017.
  • Cashflow and Profit returned to positive levels for first time this year.
  • Employment increase, but expectation that this is mainly seasonal.
  • Caveat that retail has experienced a sustained period of change / challenging conditions for a number of years, so although Q4 may have surpassed expectations, remains to be seen if this positivity will persist in 2018.


  • More negative set of results that outlined in prior Q4s, even taking into account that Q4 is generally negative for tourism.
  • Significant rise in training investment, perhaps driven by recruitment difficulties.
  • Business Rates the main concern for 57% of respondents.

The latest inflation figures show CPI has fallen to 3.0% in December, from 3.1% in November.

Downward contributions from transport prices such as air fares, and recreational products such as video games, were some of the factors which led to an overall fall in the rate.

Commenting on the latest inflation figures, Liz Cameron, Chief Executive, Scottish Chambers of Commerce, said:

“Today’s figures show inflation dropping to 3% in December, signalling an ease for the first time since June 2017 and bringing the CPI rate below the near six year high it reached in November.

“Whilst it is too early to say whether this is the start of a long-term reduction in the rate of inflation, the reduced rate will begin to ease some of the pressure on household budgets. However, food inflation still remains at a near four year high and petrol prices rose sharply as the continued impact of Brexit and rising commodity prices and raw materials passed through supply chains. Data from Scottish Chambers of Commerce Network’s Economic Indicator also shows signs of companies potentially seeking to increase prices as it becomes more difficult for firms to absorb increasing cost pressures.

“Wage growth continues to lag well behind and it will be some time before this translates into people having more money in their pockets.

“The Monetary Policy Committee should be in no rush for another rate hike.  Keeping interest rates steady is the preferred option for business.”

  • Business confidence in Scotland drops slightly from July but remains among lowest in UK
  • Investment intentions remain level for second year running
  • More businesses expect to cut jobs during the next six months than expect to create them
  • Economic uncertainty remains greatest risk to firms

Scottish businesses have reported the second lowest confidence rates in the country amid market uncertainty and concern over weak domestic demand, according to the latest Business in Britain report from Bank of Scotland.

Business confidence in Scotland – calculated as an average of respondents’ expected sales, orders and profits over the next six months – was down two points at 17 per cent compared with 19 per cent in July 2017, making it the second least confident region in the UK after Yorkshire and Humber.

However the net balance of firms looking to grow investment in the next six months remained stable at two per cent, the same level as in July 2017 while the share of firms anticipating stronger total exports remained positive at 17 per cent.

The twice yearly Business in Britain report, now in its 26th year, gathers the views of more than 1,500 UK companies, predominantly small to medium sized businesses, and tracks a range of performance and confidence measures, weighing up the percentage of firms that are positive in outlook against those that are negative.

Recruitment activity expected to slow

A net balance of seven per cent of businesses expect staff numbers to fall over the next six months, compared with a net balance of eight per cent that expected to hire more staff in July 2017.

The share of Scottish firms that continue to report difficulties hiring skilled labour has fallen by two points but remains relatively high at 43 per cent.

Meanwhile, the number of firms expecting to increase wages decreased by six points to 15 per cent, suggesting that companies are taking an increasingly cautious approach to pay.

Mixed picture across the UK

Business confidence in Scotland was the second lowest across the UK (17 per cent), with the highest being in the North East (38 per cent) and North West (31 per cent). The lowest was in Yorkshire and the Humber (15 per cent).


Confidence Index      
Region Jan 2018 (%) July 2017 (%) Change (July – Jan)
North East 38 33 +5pts
North West 31 26 +5pts
West Midlands 28 22 +6pts
London 25 20 +5pts
East Midlands 24 24
South East 24 28 -4pts
Wales 20 34 -14pts
South West 19 27 -8pts
East of England 18 22 -4pts
Scotland 17 19 -2pts
Yorkshire & Humber 15 23 -8pts

Jane Clark-Hutchison, Regional Director, Bank of Scotland said: “It’s disappointing to see Scottish businesses, towards the bottom of the confidence index but perhaps not unsurprising given the backdrop of economic uncertainty and concern over weak domestic demand.

“While confidence has dropped marginally from July, it’s still broadly in line with the sentiment felt this time last year. Encouragingly, Scottish firms remain stoic with their investment and export plans.

“Ultimately, uncertainty is at the front of Scottish business’ minds and we will need to see a shift to return to a position of growth. As Brexit negotiations continue to the next phase, we will hopefully see greater clarity which will help businesses  to plan carefully and be flexible to see through the next six months and beyond.”

Risks ahead

Economic uncertainty is now the single greatest risk to firms in Scotland in the next six months, cited by 27 per cent of firms in the region, up from 22 per cent in July.

The proportion of Scottish firms reporting weaker UK demand as their greatest risk increased to 18 per cent from 14 per cent.

Uncertainty around Brexit negotiations continue

The share of Scottish firms that are confident about business interests being protected or promoted in Brexit negotiations fell to 38 per cent from 49 per cent previously, and is now only marginally higher than the share of businesses expressing a lack of confidence, which increased to 35 per cent from 25 per cent.

When asked about the impact of a ‘no trade’ agreement with the EU on their business, overall, 14 per cent of Scottish firms said that ‘no deal’ would be positive and 46 per cent said that it would be negative.

Confidence begins to grow in sectors which rely on domestic demand

Nationally, business confidence was highest in manufacturing, while sectors more dependent on domestic demand, such as hospitality, leisure, and retail and wholesale also recorded gains.

The only sector that reported a significant fall was construction, in which confidence dropped from 31 per cent to 14 per cent.

DIT is preparing a UK trade remedies framework in readiness for the UK leaving the EU.

In support of this, the call for evidence aims to identify which UK businesses produce goods currently subject to anti-dumping or anti-subsidy measures, or to an on-going investigation related to these.

It asks those businesses to state whether they support, are neutral to, or oppose the maintaining of those measures when the UK begins to operate its independent trade remedy framework. It asks for data about those businesses’ production and sales, and total UK production and sales, to enable us to assess whether the applications meet the required criteria and can be maintained.

If a measure does not receive an application to be maintained, or does not meet the required criteria, it will be terminated once the UK begins to operate its independent trade remedy framework.

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With no elections and no referendums in the diary, The Scottish Chambers of Commerce sees 2018 as a year to focus on growing Scotland’s economy.

As policy makers grapple with an underperforming economy, and Brexit negotiations intensify, this year SCC will focus on skills shortages and internationalisation to boost lagging exports, while delivering practical growth programmes for member companies.

In overseas trade, this will be the year when the Network’s careful relationship-building begins to yield measurable commercial results for Scottish companies.

Since assuming the SCC Presidency in April, I have been continually impressed by the capacity and inventiveness within the Chambers Network.  Our task for 2018 is to consolidate the Network’s big gains of last year, while boosting Chambers influence to the wider benefit of Scotland.

Local chamber members include leaders in technology and business processes that can compete with the best. The whole nation can take inspiration from these world class manufacturing exporters.

Take Kongsberg Maritime of Wick, makers of the finest deep sea cameras in the world, using Scottish technology to explore the “Blue Planet”. Or Lochaven International in Stewarton who supply the Hogwarts school uniform for the Harry Potter film series, and for Harry Potter attractions in Florida and London. Or Michelin, based in Dundee for nearly half a century, whose capacity to produce 1000 tyres an hour will be further increased by a £100m investment.

By using our connections to forge business-to-business relationships in Europe and beyond, our Chambers Network will leverage the power of the international Chambers organisation to match member companies with the clients, suppliers and partners of the future.

In April, we will lead Scotland’s largest ever private sector-led trade mission to China, hoping to escort 30 businesses to Shandong Province, now seen as Scotland’s beachhead to this vast market.

As the overall shape of future trade relations between the UK and the EU emerges from the Brexit negotiations, SCC will continue to monitor the content of the deal, and advocate for Scottish business priorities, notably secure labour supply and continued ease of passage for goods and services.

Closer to home, where recent economic forecasts continue to paint a challenging picture for the UK and for Scotland, SCC will continue to press our governments to help business to thrive.

First and foremost this means improving the supply of skilled people.  We will continue to give feedback to government on skills gaps while actively supporting initiatives such as Developing the Young Workforce.

On tax, we will reinforce our view that gains from even marginally increased taxes on middle and higher earners may be outweighed by losses in talent and investment if Scotland is perceived as the highest-taxed part of the UK.

Last year was a year of positive change for Scottish Chambers of Commerce. We have restructured our internal organisation, forged a new partnership and co-location with Strathclyde University Business School and made impressive gains in international trade.  Meanwhile our mentoring programme has continued to thrive.

In advocating for members on important areas of public policy, such as non-domestic rates and income tax, the SCC has ensured that, for better and worse, Scotland’s political leaders have made their decisions in full knowledge of the views of the nation’s wealth creators.

With the welcome encouragement of Scottish Ministers, we will step up our efforts to build a constructive working relationship with the Scottish Government, which will continue to bear fruit in 2018. We will also further our work to increase influence at UK Government level, notably through our Westminster Reception in March 2018.

I wish all of you a very happy and a prosperous New Year.

The latest labour market figures have held to the trend of a strong employment rate, while continuing to illustrate a job market characterised by wages that are failing to keep pace with inflation.

In Scotland specifically, although there has been a quarterly decline in employment, the annual employment rate has increased by 1.7 percentage points, joint-second with the South East.

Scotland has also displayed the second highest annual increase in workforce jobs, by 109,000, with only the West Midlands displayed a higher figure.

Liz Cameron, Chief Executive, Scottish Chambers of Commerce said:

“For the seventh consecutive month, today’s figures show that wage growth has failed to outpace inflation, with the CPI rate of 3.1%, further biting into household disposable income.

“Vacancies are also now sitting at a record high across the UK, further emphasising the importance of continued investment into training and workforce skills, and the continued need for business to have access to a migration system that enables firms to recruit from outside of the UK when required.

“Although the Scottish employment market continues to show signs of strength, our focus is now on the upcoming Scottish Budget. It is critical that any measures put forward on Thursday recognise the existing pressures on household spending, and that policies targeted at Scottish business, at minimum, ensure a level footing with the rest of the UK.”

More Scottish businesses will have the opportunity and support to trade abroad, thanks to a new initiative.

Five pilot Local Export Partnerships (LEPs) are being launched by the Scottish Government and Chambers of Commerce to increase the number of firms exporting their products and services.

The partnerships – in Cairngorms; Inverness/Highlands and Islands; Dumfries and Galloway/Scottish Borders; Edinburgh/Lothian and Glasgow/Lanarkshire – will bring together Scottish Development International, local authorities and a range of local support organisations. They will offer support and expertise to companies, particularly SMEs, with little or no previous exporting experience and help them enter international markets.

The Scottish Government is providing up to £400,000 to the Scottish Chambers of Commerce to develop the pilot programme.

Economy Secretary Keith Brown said:
“With Brexit looming, international trade and export has never been so vital to the Scottish economy, but it can seem daunting to businesses who haven’t yet ventured into the field.

“It is crucial that we maximise the help and support available to those firms – particularly the SMEs which are the lifeblood of our economy.

“These pilots will test new approaches to support businesses to export, opening a whole new world to companies and employers throughout Scotland.”

As outlined in the Scottish Government’s Trade and Investment Strategy, the partnership will use a collaborative, One Scotland approach. It will bring together individuals, businesses and agencies to promote an international business awareness and mindset, collaboration around shared trade objectives and mutual learning and support.”

Liz Cameron OBE, Director and Chief Executive of Scottish Chambers of Commerce, said:
“On behalf of the Scottish Chambers Network, we are delighted to have the opportunity to work closely with The Scottish Government and its agencies in this exciting new Local Enterprise Partnership initiative.

“These new LEPs will build on the strong partnerships we have recently forged with government in the field of international trade, which has already resulted in promising new routes to accessing important markets for Scottish goods and services, notably China.

“The combination of the Chambers’ network at grass roots and the experience and in-market expertise within government and its agencies is a powerful one. This LEP initiative allows us to show what can be achieved for exporters with a Team Scotland approach.”

The latest UK inflation figures for October show that consumer price inflation has held at its highest level since April 2012, with the CPI rate holding at 3.0%.

As with the figures released in September, the rate of inflation continues to be driven by increases in the price of food. Prices for food and non-alcoholic beverages increased by 0.4%. The increase in recreation and culture costs also continued from September, with a 0.5% rise building on the growth in prices observed last month. As highlighted by the ONS, the UK has consistently observed higher price inflation across both goods and services for the last six months.

Meanwhile, producer price inflation rose by 2.8%, mainly due to a slowdown in the rate of petroleum price growth. As with Consumer Prices, this is slightly lower than the markets were anticipating.

Liz Cameron, Chief Executive, Scottish Chambers of Commerce said:

“Although the hold in the CPI rate is a more positive outcome than the rise that many analysts were expecting today, the continued increase in the prices of food and recreational products emphasise the persistent pressure on the budgets of UK households. Furthermore, the CPIH figures highlight growing owner occupier costs, such as electricity and council tax.

“Rising mortgage payments, bolstered by the decision to raise interest rates, alongside the sustained weakness of sterling will also act to slow consumer demand and impact the bottom lines of businesses.

“These figures come at a crucial time for the Chancellor, and it is essential the Autumn Budget presents a range of measures to jumpstart the UK economy, including encouraging businesses to invest in their employees and boost productivity, look to new markets for trading opportunities and investment in essential infrastructure.”

The latest results from The Scottish Chambers of Commerce’s Quarterly Economic Indicator survey show optimism amongst most Scottish businesses continuing to improve during the 3nd quarter of 2017, reaching levels higher than a year ago in construction, financial and business services, manufacturing, and tourism.

The survey, produced by the Scottish Chambers of Commerce Economic Development Intelligence Unit in collaboration with the Fraser of Allander Institute of the University of Strathclyde, shows Scottish businesses remaining resilient in the face of significant policy uncertainty and a fragile Scottish economy which continues to grow at below trend levels.

Professor Graeme Roy of the Fraser of Allander Institute, one of the report’s contributors, has warned that record high employment levels are increasingly leading to recruitment difficulties across most sectors, leading to dampened growth and increases costs.

In a foreword to the report he said: “In such uncertain times, it is even more important that businesses focus on the long-term drivers of growth that they can control – including innovation, investing in productivity improvements, and developing the skills of their workforce.”

The survey also showed that tourism was a stand-out performer over the third quarter of 2017 due to the weak pound’s effect on foreign holidays.
By contrast there was cause for concern in the continued decline in the retail & wholesale sector in Scotland, with several indicators including sales revenue and cash flow continuing to decline along with employment trends, emphasising the added importance of a strong performance in the Q4 pre-Christmas period.
Financial services also appears to be building on its strong start to 2017 albeit activity has yet to fully recover to where it was three of four years ago, while despite improving optimism overall activity in construction continues to remain relatively fragile.

Neil Amner of Anderson Strathern, Chair of the Scottish Chambers of Commerce Economic Advisory Group, said:

“The results in our third quarterly economic indicator of 2017 point to a broadly positive picture for Scottish business. However, the retail sector in particular continues to show decreasing sales, in addition to cashflow and profitability challenges.

“This continues on from our findings in the second quarter which highlighted persistent issues in the retail sector. Levels of inflation have continued to impact on real terms wage growth, which has maintained pressure on household budgets and translated into recurrent challenges for this sector.

“With the exception of retail, our results generally show broad optimism of varying levels across Scottish business. In particular, the Financial and Business Services sector has displayed strong, positive results – with sales and profitability at their highest levels for several years. Unsurprisingly, this has translated into increased optimism, with third quarter optimism levels higher than figures recorded across Q3 2015 and Q3 2016.

“For many of our industries, recruitment difficulties continue to sit above the long term trend levels, exacerbated by the record high employment figures. Concerns continue to be raised by our members when it comes to seasonal workers and the attractiveness of the UK to EEA migrants during the uncertainty surrounding the Brexit negotiation process.

“Furthermore, members in more traditional industries have highlighted issues in attracting younger workers. Businesses in sectors such as manufacturing must do more to reimagine their workplaces to attract future talent, by focusing on increasing autonomy and flexibility in their working practices.”