Scottish firms’ confidence has rebounded in the first month of 2022, according to the latest Bank of Scotland (BoS) Business Barometer.
It highlights the strongest reading of business confidence since September 2021, with a net balance of 37% of firms expressing optimism for the future – both theirs and the overall economy.
The bank also found the number of companies looking to increase staffing over the coming 12 months rose.
The net balance of businesses expecting to grow headcount was up by one percentage point at 24%.
Overall UK business confidence remained steady, down just one percentage point to 39%, with all nations and regions recording a positive reading.
The Business Barometer, which questions 1,200 businesses monthly, provides early signals about UK economic trends both regionally and nationwide.
Fraser Sime, regional director for Scotland at Bank of Scotland Commercial Banking, said: “After a turbulent end to the year, with the rise of the Omicron variant sparking new restrictions, it’s encouraging to see Scottish business confidence rebound as we kick off 2022.
“While the situation remains challenging, the recent easing of restrictions in Scotland will be a boost for businesses.
“We hope the situation will continue to improve as the year progresses.”
BoS – part of Lloyds Banking Group – said industry sector performance had been mixed this month.
Confidence among UK manufacturers has increased by three percentage points to 43%, reaching its highest level for three months, the bank said, citing an easing of supply chain pressures as the reason.
Retail confidence is up by one point at 44%, while confidence among firms in IT/communications remains “particularly strong” at 72%, BoS added.
2022 has started in a positive place.”
Paul Gordon, Lloyds Bank Commercial Banking.
The impact of Omicron over the festive period meant the service sector has extended its recent run of modest decreases, dropping one point to 38%.
BoS added: “Hospitality has recovered some of December’s decline, rising from 6% to 38%.”
Paul Gordon, managing director, SME (small and medium-sized enterprises) and mid corporates, Lloyds Bank Commercial Banking, said: “2022 has started in a positive place as Omicron infection rates have slowed and restrictions have eased following this survey, providing encouragement there is a light at the end of the tunnel for UK businesses.”
Scottish private sector growth weakens as Omicron concerns strike