Business confidence 'still near record low' despite rise

A slight improvement has been recorded in business confidence in Scotland – but it still remains near record low levels, a report has found.

The Bank of Scotland’s business barometer survey found confidence rose 17 points during May to -33%.

The monthly barometer questions 1200 companies across the UK to gauge economic trends.

As the coronavirus crisis continues, demand for products and services remains low but the picture has improved slightly since April.

The survey found 65% of Scottish firms experienced a fall in demand for their products and services, down seven points on the month before.

Meanwhile, 12% had an increase in demand, up on 5% in April.

There are also signs companies are starting to reopen after shutting down completely in April.

The number of Scottish firms operating at less than 50% capacity increased 18 points to 43% while a fifth of firms were not operating at all, down from 32% in April.

Three-quarters of businesses reported disruption to their supply chain, with 14% of those saying it would take more than a year for it to return to normal.

Fraser Sime, regional director in Bank of Scotland’s commercial division, said: “Scottish firms have been hit hard by this crisis, but they’re showing resilience in the face of great challenge.

“It’s encouraging to see that some businesses are beginning to reopen as demand creeps back.

“We’re standing shoulder-to-shoulder with companies from all sectors to help them overcome the challenges presented during this difficult time.”