Scottish Economy Contracts: Price Of Oil To Blame

A survey by the Bank of Scotland has shown a slight dip in the economy.

Last week the Federation of Small Businesses warned that the closure of the Forth Road Bridge would have a detrimental impact on firms in Fife.

This week we learn that the Scottish economy contracted in November.

A survey by the Bank of Scotland shows staffing levels are up, but business activity fell in November.

For the second time in three months, business activity in Scotland’s private sector contracted territory in November. Latest survey data also indicated a fall in incoming new orders, with panel members linking the drop to a downturn in the oil and gas industry. Jobs growth was reported by firms amid falling backlogs of work.

Incoming new orders received by private sector companies in Scotland declined for the second time in three months during November. Scottish goods producers registered a sharp contraction in both domestic and foreign demand.
 
November data signalled a slight expansion in employee numbers in Scotland’s private sector. Moreover, staffing levels have increased in each of the past four survey periods. That said, the rate of job creation was weak.
  
Alasdair Gardner, Bank of Scotland Regional Managing Director Scotland - Commercial Banking, said, “The headline index fell below the crucial 50.0 mark in November, as a slowdown in the oil and gas industry veered the Scottish economy into contraction. The drop in activity stemmed from declining new orders, which was affected by unfavourable exchange rates. However, this did not discourage firms from further adding to staffing numbers.”