Chambers: Scots economy ‘on a knife edge’

Liz Cameron, chief executive of the Scottish Chambers of Commerce

Scotland’s economy is “on a knife edge between growth and recession” and the Scottish Government needs to put growth at the centre of its plans for the next five years, said the chief executive of Scottish Chambers of Commerce.

The Scottish Chambers’ latest quarterly economic indicator showed Scotland’s business performance was “inconsistent across a range of sectors” in the first three months of 2016.

“As Scotland prepares to head to the polls for next month’s Scottish Parliamentary elections, we know that our economy is on a knife edge between growth and recession and that the prospects for the future are unclear,” said Scottish Chambers’ CEO Liz Cameron.

“In these circumstances, it is imperative that our new Scottish Government puts the economy at the centre of its plan for government over the next five years, systematically addressing those factors under the Scottish Parliament’s control that could be used to make Scotland the most competitive place in the UK to do business.”

The survey showed construction performed strongly, manufacturing experienced a sharp dip, and the service sector continued to perform poorly though non-oil and gas sector businesses continue to register growth.

Growing online sales helped to boost confidence in the retail sector, “whilst strong performance amongst tourism businesses masks tightening profit margins and weak confidence on future performance,” Cameron said.

“Investment trends overall remain positive but tend to be growing more slowly, whilst a mismatch between positive employment trends and mixed business performance raise further question marks about future productivity levels.

“We are also picking up some anecdotal evidence that the EU referendum may be having an effect on the timings of some investments and deals.

“It is important that lessons are learned.  As the construction sector continues to experience worrying levels of skills shortages due to rapid growth following a period of recession, so we must plan ahead now for the recovery in oil prices, ensuring that the oil and gas sector has the talent it needs when the sector resumes growth.”

About the Author

Mark McSherry
Dalriada Media LLC sites are edited by veteran news journalist Mark McSherry, a former staff editor and reporter with Reuters, Bloomberg and major newspapers including the South China Morning Post, London's Sunday Times and The Scotsman. McSherry's journalism has also appeared in The Washington Post, The Guardian, The Independent, The New York Times, London's Evening Standard and Forbes. McSherry is also a professor of journalism and communication arts in universities and colleges in New York City. Scottish-born McSherry has an MBA from the University of Edinburgh and a Certificate in Global Affairs from New York University.