Job creation in Scotland reached an eight-month high in April despite business confidence easing to its lowest in six months, according to April’s Bank of Scotland Regional Purchasing Managers’ Index (PMI).

The report showed that the Scottish private sector made a positive start to the second quarter, seeing growth pick up slightly from the relative stagnation experienced in March.

The upturn was driven by a strong manufacturing sector, which offset shrinking services output.

Fraser Sime, Regional Director, Bank of Scotland Commercial Banking, said: “April’s PMI signalled a tentative upturn in Scottish private sector growth, with both output and employment increasing at faster rates.

“The latest survey’s results were driven by a strong manufacturing sector, which moved up a gear in April.

“There was good news all round from steep production growth, to solid job creation and a further easing of cost pressures.

“Meanwhile, the service sector marred April’s PMI score as business activity in the sector shrunk for the second month running.

“A faster rise in new orders bodes well, though continued growth in the second quarter remains heavily dependent on the relatively stronger manufacturing sector.”

On prices, input cost inflation accelerated, leading to a marked rise in charges.

The seasonally adjusted headline Bank of Scotland PMI rose to 50.6 from March’s four-month low of 50.1.

The rate of growth signalled remained below the historical series average since January 1998.

Price pressures remained sharp in April, with input price inflation higher than the UK average for the first time in four months.

“Panellists noted rising raw material cost and wage pressures as key factors,” said the report.

“According to anecdotal evidence, companies then passed on part of the burden of increased costs to customers, as corroborated by a marked rise in output charges in April.”