Scottish businesses resilient and growing in face of global challenges

Scotland’s businesses plan to employ more staff and increase salaries in 2016, according to new research from Edinburgh-based business and financial adviser Grant Thornton

Scotland’s businesses plan to employ more staff and increase salaries in 2016, according to new research from Edinburgh-based business and financial adviser Grant Thornton.
Senior business leaders from across Scotland took part in the Grant Thornton International Business Report research, which draws on the views of thousands of senior decision makers in 36 economies, between February and December 2015.
Despite uncertainty over oil and gas prices and the long term future of the country’s largest sector, more than half (56%) of Scottish respondents believe their profits will increase this year. The figure is substantially higher than the global average of 44%, but slightly below the 63% of UK-wide respondents predicting a rise in profitability.
Meanwhile, almost half of those questioned (46%) plan to increase headcount over the next twelve months – across the European Union, the figure is 28%, slightly less than the global average of 31%.
 The latest Scottish Government research highlights the importance of international exports (excluding Oil and Gas) to Scotland’s economy – valued at more than £27.9 billion in 2014. However, the IBR data suggests that growing global uncertainty could be damaging international expansion plans. While more than half of Scottish respondents (58%) plan to expand domestically, only 8% intend to expand overseas. Meanwhile, only 14% of Scottish businesses are looking to increase their exports, compared with a UK-wide average of 23% and an EU average of 28%.
Investment in research and development this year also appears to be a low priority for Scottish businesses with less than a quarter (24%) of respondents planning to invest in innovation this year, although the figure is above the global average of 22%.
Debbie Mayor, associate director of Advisory at Grant Thornton in Scotland, said: “Aside from oil and gas concerns, wider political and economic turmoil dominated 2015 – from the refugee crisis and conflict in the middle east to instability in Chinese markets and declining optimism in developing economies such as Brazil. But, despite the shifting world landscape, our research suggests Scotland’s businesses are resilient and are optimistic about growth in the year ahead.
“The data is largely positive, but it does highlight the growing impact that global markets and political volatility are having on our increasingly internationally focused Scottish economy. The fact that so few Scottish respondents plan to grow overseas this year highlights the concerns that business leaders currently have about wider economic optimism in the months ahead.”
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