SCC QUARTERLY ECONOMIC INDICATOR: Q3 2022 REPORT

GOVERNMENTS MUST SUPPORT BUSINESS AS ECONOMY BRACES FOR RECESSION

The latest findings from a leading Scottish business survey by the Scottish Chambers of Commerce (SCC), shows the Scottish economy struggling against a growing whirlwind of pressures including increased input costs, inflationary hikes, mis-judged economic policy choices by the UK Government and increased pessimism over the global economic outlook

KEY FINDINGS:
• INFLATION REMAINS TOP CONCERN: Last quarter saw record high level of concern from inflation, cited by 92% of all firms. While it has eased over the quarter, it remains at significantly high levels for the survey at 88% of all firms, compared to the average of 35% from 2018 – 2021.

• ENERGY BILLS TOP LIST OF COST PRESSURES: The top cost pressure is from utilities such as electricity and gas with it being cited by 80% of firms, followed by labour costs at 72% and then fuel costs at 63% of firms.

• FIRMS STILL PLANNING TO RAISE PRICES: 8 in 10 of all firms indicate that they intend to raise the prices that they charge over the next quarter, this is a record high for the survey and a figure which has grown exponentially over the year. In comparison, 50% of all firms said they would increase their prices in Q3 2021 last year.

• STRUGGLING CONFIDENCE: Cashflow and profits remain weak across all sectors. On balance, all firms have reported a fall in confidence compared to the previous quarter and a more significant fall compared to last year. On a sectoral basis, construction, retail and tourism sectors all reported falls on balance.